Oil Prices Hold Gains After Surge on Iran Sanctions and OPEC+ Cut Pledges

Oil markets maintained their recent momentum Friday morning as traders weighed geopolitical tensions against economic concerns.

WTI crude traded at $63.07 per barrel with a minimal increase of 0.01%, while Brent crude stood at $67.84, showing a slight decline of 0.06%. These figures follow Thursday’s significant rally when WTI jumped 3.54% to close at $64.68.

Brent also climbed nearly 3% to $67.70 per barrel. The primary catalyst for Thursday’s price surge came from the United States’ implementation of fresh sanctions targeting Iran’s oil exports.

These measures also affect a China-based refinery and associated shipping networks, potentially restricting global oil supply. Market participants view these sanctions as part of a renewed “maximum pressure” policy that could remove substantial Iranian crude from international markets.

Supply concerns intensified after OPEC+ announced it had received updated plans from several members to implement additional production cuts. Iraq, Kazakhstan, and other producers pledged to reduce output to compensate for previous overproduction.

These adjustments could remove up to 520,000 barrels per day from global supply, further tightening market conditions. Political developments have also influenced crude prices.

Oil Markets Rally Amid Trade Hopes

A meeting between US President Trump and Italian Prime Minister Giorgia Meloni signaled potential progress in resolving trade disputes. “We’re going to have very little problem making a deal with Europe or anybody else,” Trump told reporters, easing concerns about broader trade tensions.

Inventory data showed mixed signals but generally supported the price rally. US crude stocks increased slightly by 515,000 barrels last week, marginally above analyst expectations.

However, declining gasoline and distillate inventories indicated robust consumption patterns ahead of the summer driving season. Technical indicators suggest continued bullish momentum for oil prices.

Brent crude appears to be trading within an uptrend channel with support near $65.85 and potential targets above $70.25 if current trends persist. WTI has broken above key moving averages, establishing a technical foundation for further gains.

Despite the current rally, major financial institutions maintain cautious outlooks. Goldman Sachs recently lowered its WTI price forecast to an average of $59 per barrel for 2025.

This reflects concerns about potential demand weakness from slowing economic growth in major markets like China and the United States. Oil markets face conflicting pressures as they enter the weekend.

Geopolitical tensions and production cuts provide upward momentum, while macroeconomic worries create headwinds. Traders must now determine whether supply constraints will outweigh potential demand concerns in the coming weeks.

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