Oil prices ease on Thursday

Oil prices edged lower on Thursday as traders locked in profits while assessing the risk of supply disruptions following renewed US strikes on Iranian military sites that heightened fears of a wider conflict in the Middle East.

Brent crude futures fell 44 cents, or 0.52 per cent, to $84.51 a barrel by 0605 GMT, while US West Texas Intermediate (WTI) crude slipped 23 cents, or 0.29 per cent, to $79.37 a barrel. Both benchmarks remained near one-month highs after posting gains earlier in the session.

Prices have risen this week as renewed hostilities between the United States and Iran raised concerns over oil flows through the Strait of Hormuz, which accounts for around one-fifth of global oil and liquefied natural gas trade. Shipping traffic through the waterway also declined on Wednesday following the US naval blockade of Iranian ports.

Analysts said geopolitical tensions continue to support oil prices, although markets are now focused on whether the conflict leads to sustained disruptions in energy supplies.

They warned that further escalation, including potential threats to the Bab el-Mandeb shipping route, could drive prices higher, while easing tensions and recovering production could push crude lower later this year. Goldman Sachs said Brent could exceed $110 a barrel in the fourth quarter if Gulf export disruptions persist.

Attribution: Reuters