Oil Weakens, But Still Gains Weekly Profits
Oil prices weakened slightly in early trading on Friday (July 10th), but remained on track for weekly gains. This movement occurred as the market continued to monitor tensions between the United States and Iran, which are continuing to trade attacks, making the risk of energy supply disruptions from the Middle East a major concern.
Brent fell 6 cents, or 0.08%, to US$76.24 per barrel at 01:25 GMT. Meanwhile, West Texas Intermediate (WTI) weakened 4 cents, or 0.06%, to US$72.04 per barrel. Despite the slight correction, Brent is still on track for a gain of around 6% this week, while WTI has the potential to gain around 5%.
Pressure on oil prices arose as the market began to worry that rising inflation could suppress energy demand. If inflation continues to rise, purchasing power and economic activity risk slowing, thereby weakening oil demand. This concern has prevented investors from aggressively buying oil despite the ongoing geopolitical risks. In terms of the conflict, Iranian forces launched attacks on US military infrastructure in the Gulf states after Washington attacked Iran's southern coastal areas and eastern provinces. Iranian media also reported several explosions in southern Iran, including in Bushehr, the site of one of the country's nuclear plants. This situation further strains the ceasefire, which has only been in place for about three weeks.
However, the market has found some relief as President Donald Trump's administration has so far avoided direct attacks on Iran's energy infrastructure. Trump also stated that he does not expect the war to escalate into a full-scale conflict. However, the full opening of the Strait of Hormuz, which previously carried around 20% of global oil and gas supplies daily, remains pending. Therefore, oil prices remain potentially volatile as long as supply risks from the region remain unabated. (asd)*
Source: Newsmaker.id
