Oil prices were ticking up slightly but largely flat in Asian trading Friday as supply losses from Iraqi pipeline disruptions were offset by renewed demand concerns tied to U.S. tariff threats against key Asian economies. Brent crude edged up to $69.78 and WTI was trading at $67.75 at 2.25 a.m. ET, with both benchmarks holding narrow gains despite broader market uncertainty.
Multiple drone strikes near oil infrastructure in Iraqi Kurdistan this week forced the suspension of production at several fields. The attacks disrupted operations and prompted a temporary halt in output. No group has claimed responsibility, but the incidents mark the most serious disruption in the region since April.
The latest strikes have shut in at least 150,000 barrels per day of oil production across multiple sites, with some estimates nearing 200,000 bpd of shut-ins. The fields are operated by international consortia under contract with the Kurdistan Regional Government (KRG).
Energy officials in Kurdistan told Reuters that the region’s output stood at approximately 285,000?bpd before production was slashed by up to 150,000?bpd due to the attacks, cutting output nearly in half
Tariff warfare, however, appears to be in the driver’s seat with respect to oil markets this week, overtaking fears of supply shut-ins in Iraqi Kurdistan. Growing fears of a tariff escalation between the U.S. and multiple Asian exporters have added pressure to fuel demand forecasts.
With global growth already showing signs of slowing, the possibility of another round of tit-for-tat trade measures has weighed more heavily on oil sentiment than localized supply shocks. Reuters cited analysts on Friday as saying that the muted price response to the Kurdistan outages suggests markets are increasingly discounting temporary disruptions unless they escalate or coincide with broader geopolitical risk.
By Charles Kennedy for Oilprice.com
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