Oil prices pulled back sharply on Friday, reversing part of the previous session’s surge, after Israeli Prime Minister Benjamin Netanyahu suggested the Iran war could end sooner than expected.
At the time of writing, West Texas Intermediate crude was trading at $92.57, down 3.12%, while Brent crude stood at $105.18, down 3.19%.
The latest decline follows a volatile 24-hour period in which oil prices surged dramatically on the back of an Israeli attack on the South Pars gas field and an Iranian attack on energy infrastructure across the region. Those escalations briefly pushed Brent beyond $119 per barrel on Thursday, as fears of further serious supply disruptions peaked.
Sentiment in markets then shifted as Netanyahu said that joint U.S.-Israel strikes had significantly degraded Iran’s strategic capabilities and that the war would “end faster than people think.”
Crucially for oil markets, Netanyahu also emphasized that the campaign would not be open-ended and indicated that Israel would refrain from further attacks on Iran’s South Pars gas field at the request of President Trump. The move helped ease immediate concerns about further escalation targeting critical energy infrastructure.
Broader financial markets reflected the shift in risk sentiment. South Korean equities rose 0.5% in early Friday trading following Netanyahu’s remarks, while the S&P 500 closed 0.3% lower after recovering from deeper losses earlier in the session.
Adding to the downward pressure, U.S. Treasury Secretary Scott Bessent said Washington could authorize another release from the Strategic Petroleum Reserve to help contain oil prices.
Despite the pullback, oil prices remain elevated as the market desperately looks to replace disrupted supply. U.S. oil is now being directed through the Panama Canal to help deal with the shortfall in Asia, with the U.S. even considering lifting sanctions on some Iranian oil to ease the crunch.
By Josh Owens for Oilprice.com
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