Oil swung from gains to losses on Friday as traders weighed the prospects of retaliatory US tariffs with supply implications from stricter US policy against Iran.
West Texas Intermediate crude (CL=F) pared gains to fall below the flatline, on track to end the week negative, while Brent futures (BZ=F) also declined but were on pace to break a three-week losing streak.
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Oil gained as much as 1% on Friday amid supply worries after Treasury Secretary Scott Bessent told Fox Business, "We are committed to bringing the Iranians to going back to 100,000 barrels per day of exports, as when Trump left office."
Last week, the US announced the first sanctions under Trump's current administration against Tehran, targeting individuals, firms, and tankers.
However, the threat of an escalating trade war has kept a lid on price movements to the upside this week.
On Thursday, President Trump signed a plan for reciprocal tariffs but delayed their implementation as his staff launches negotiations on a one-by-one basis with each country.
The tariff plan comes on the heels of levies imposed on select Chinese products last week, which in turn were met by Beijing with retaliatory duties on US goods.
"The demand picture remains in question near term as the retaliation of even higher US tariffs may hamper global demand," Dennis Kissler, senior vice president at BOK Financial, wrote in a note to clients on Friday.
Aerial view of an oil platform with an industrial ship sailing in the background in California. · simonkr via Getty Images
Earlier this week, oil declined on the prospect of a path toward a truce in the Ukraine-Russia war after President Trump said the leaders of both countries want peace.
"While a comprehensive peace agreement may remain elusive, a ceasefire is sufficient for the market to begin pricing in its implications," wrote JPMorgan's Natasha Kaneva in a note earlier this week.
JPMorgan analysts said their 2025 outlook from Brent remains unchanged at an average of $73 per barrel amid a surplus of supply.
"Looking ahead to 2026, we foresee another year of large surpluses driving Brent prices below $60 by year-end, with an average Brent forecast of $61," wrote JPMorgan's Kaneva and her team.
WTI is down slightly year-to-date, while Brent is less than 1% higher since the start of January.
Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on X at @ines_ferre.
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