Oil edges up on Saudi supply concerns but set for steepest weekly loss since June

Oil prices rose towards $100 a barrel on concerns over Saudi Arabia supply disruptions and limited flows through the Strait of Hormuz, but were still on track for ‌their biggest weekly fall since last June as a fragile ceasefire held.

Brent crude futures were up 40 cents, or 0.4%, at $96.32 a barrel at. West Texas Intermediate futures were up 84 cents, or around 0.9%, at $98.71.

Both contracts have lost about 12% this week after Iran and the U.S. agreed on Tuesday to a two-week ceasefire brokered by Pakistan.

However, fighting has continued and the flow of oil through the Strait of Hormuz remains heavily restricted, keeping futures near $100 a barrel and pushing prices in the physical market to record highs.

“The key issue for the oil market is whether ship traffic through the Strait of Hormuz will resume. So far, there are no signs of this happening. If oil supplies from the Persian Gulf remain blocked, oil prices are likely to rise again,” Commerzbank analysts said in a note on Friday.

Traffic through the Strait of Hormuz remained less than 10% of normal volumes as Tehran asserted its control by warning ships to keep to its territorial waters.

The majority of ships that have sailed through the Strait in the past day were linked to Iran, ship-tracking data showed on Friday.

Iran wants to charge fees for ships to pass through the strait under a peace deal, a Tehran official told Reuters on April 7.

Western leaders and the United Nations’ shipping agency have pushed back on the idea.

The crucial artery for oil and gas flows has been effectively shut down by the conflict that began when the U.S. and Israel launched airstrikes against Iran on February 28.

More than 60 energy infrastructure assets across the Gulf have been hit by drone and missile strikes, with around 50 sustaining varying degrees of damage.

While most attacks are not expected to cause prolonged disruptions, at least eight ‌facilities face lengthy repair timelines, according to a Thursday note from Natasha Kaneva, head of global commodities research at J.P. Morgan.