NEW YORK / RankWire.AI / – Oil prices surged by more than 4% on Friday. Brent crude exceeded $88 per barrel, with both major benchmarks reaching their highest closes in over a month. Brent futures increased by $3.87, or 4.59%, to settle at $88.10 a barrel. U.S. West Texas Intermediate rose by $3.54, or 4.48%, ending at $82.49. Both contracts saw approximately 16% gains for the week. Brent marked its third consecutive weekly rise, while WTI recorded its second.
The upward movement occurred amid a significant drop in commercial shipping through the Strait of Hormuz. This crucial waterway remains a key route for global oil and gas shipments. On Thursday, only three commodity vessels navigated through, the lowest daily number since May. On Wednesday, eleven ships passed through, compared to an average of 125 daily before the conflict. No very large crude carriers or liquefied natural gas tankers crossed for the second day in a row.
Meanwhile, the U.S. and Iran intensified attacks on infrastructure this week, while restrictions again curtailed shipping activity in the Gulf. Iraq temporarily halted oil loadings at its Basra terminal following a drone strike on a tanker, but later resumed operations. Two large crude carriers, each with roughly 2 million barrels of oil, appeared outside Hormuz after departing the Gulf earlier in the week. These events coincided with the largest daily gains of the week in crude futures and a rise in energy prices across global markets.
Hormuz shipping declines amid rising crude prices
The International Energy Agency reported that Gulf oil exports increased by 6.5 million barrels per day in June, reaching a total of 16.1 million barrels daily. Despite this gain, exports remained below the pre-conflict level of 24 million barrels per day. The bulk of the monthly increase was driven by crude and condensate shipments. Gulf production rose by 3.5 million barrels daily but stayed 11.4 million barrels below earlier levels. These figures indicate only a partial recovery prior to the recent decrease in vessel traffic.
The IEA also noted a 21 million barrel increase in global observed oil inventories in June, marking their first monthly rise in four months. Waterborne oil stocks grew by 117 million barrels, while onshore reserves declined by approximately 96 million. Government releases contributed 44 million barrels to the onshore decline. Exports of refined products and liquefied petroleum gas from the Gulf remained below half of pre-conflict levels, whereas crude exports approached nearly 75% of previous rates.
Weekly increases boost both benchmarks
The U.S. Energy Information Administration indicated that Brent spot prices averaged $85 a barrel in June, down $22 from May. Prices later dipped below $70 on July 1 but recovered in the first half of July. The agency estimated global oil inventories shrank by 5.1 million barrels per day during the second quarter. It also projected that production shut-ins averaged 8.3 million barrels daily in June, after peaking at 11.2 million in May.
On Friday, Brent closed at $88.10, which is $12.09 above its July 10 close of $76.01. WTI finished at $82.49, $11.08 higher than its $71.41 close from the previous week. These movements represent weekly gains of approximately 15.9% for Brent and 15.5% for WTI. Energy stocks were the only major U.S. sector to end the week higher, with both oil contracts closing near their session highs, in a week characterized by substantial price increases and decreased tanker activity through Hormuz.