Oil prices rose on Friday as concerns about a conflict between the United States and Iran grew, with Washington saying Iran would be in trouble if it did not agree to a deal on its nuclear activities within days.
Brent crude oil futures rose 21 cents, or 0.3%, to $71.87, and U.S. West Texas Intermediate crude oil rose 23 cents, or 0.4%, to $66.66.
Prices settled at a six-month high on Thursday after U.S. President Donald Trump said “really bad things” will happen if Iran doesn’t reach a deal on its nuclear program, which it claims is peaceful but the United States believes is militaristic. President Trump has set a deadline of 10 to 15 days.
Meanwhile, local news agencies reported that Iran is planning joint naval exercises with Russia, days after temporarily closing the Strait of Hormuz for military exercises.
This major oil producer is located across the oil-rich Arabian Peninsula across the Strait of Hormuz, through which about 20% of the world’s oil supplies pass. Conflict in the region could limit oil supplies to global markets and push up prices.
Also supporting oil prices were reports of declining crude oil inventories and export restrictions in the world’s largest oil producing and exporting countries.
U.S. crude oil inventories fell by 9 million barrels due to increased refining usage and exports, according to an Energy Information Administration report on Thursday.
Oil exports from Saudi Arabia, the world’s biggest oil exporter, fell to 6.988 million barrels a day in December, the lowest level since September, according to data from the joint organization Data Initiative.
Elsewhere, Japan’s annual core consumer inflation rate hit 2.0% in January, its lowest level in two years, potentially delaying the central bank’s plans to raise policy rates.
Low interest rates in oil importing countries like Japan are typically seen as supporting oil prices. (Reporting by Lila Carney in New York; Editing by Christopher Cushing)
