Global oil markets witnessed renewed volatility on Friday as prices climbed amid escalating concerns over supply disruptions linked to Saudi Arabia and severely restricted tanker traffic through the strategic Strait of Hormuz. Read More: https://theboardroompk.com/pakistan-oil-gas-sector-reports-three-discoveries-in-march-2026-amid-isreal-us-war-on-iran/ Despite the upward movement, both major oil benchmarks remained on track for a weekly loss. Market sentiment stayed mixed as traders weighed supply fears against cautious optimism surrounding a fragile ceasefire between the United States and Iran. Oil Prices Edge Higher Amid Supply Anxiety Brent crude futures rose by 58 cents, or 0.60%, reaching $96.50 per barrel in early trading hours. Meanwhile, West Texas Intermediate (WTI) crude gained 49 cents, or 0.50%, to trade at $98.36 per barrel. However, both benchmarks have recorded an 11% decline so far this week. This marks the steepest weekly drop since June 2025. Analysts attribute the decline to temporary easing of geopolitical tensions following a two-week ceasefire announcement. Still, uncertainty remains high. Market participants continue to monitor developments closely, especially disruptions affecting oil supply chains. Saudi Oil Infrastructure Hit by Attacks Fresh concerns emerged after reports confirmed attacks on Saudi energy infrastructure. According to official sources cited by the Saudi state news agency, the strikes have significantly impacted production capacity. The attacks reduced Saudi Arabia’s oil output by approximately 600,000 barrels per day. In addition, throughput on the East-West Pipeline dropped by around 700,000 barrels per day. These disruptions have intensified fears of a prolonged supply crunch. Analysts at ANZ noted that initial market relief has faded quickly as underlying risks resurface. Energy markets remain sensitive to any further escalation. Even minor disruptions could trigger sharp price swings in the coming days. Hormuz Traffic Remains Critically Low Shipping activity through the Strait of Hormuz remains severely restricted. Tanker traffic has fallen to less than 10% of normal levels despite the ceasefire agreement. Iran has maintained tight control over the waterway. Authorities have warned vessels to remain within designated territorial routes, further limiting movement. The Strait of Hormuz serves as a vital corridor for global oil and gas flows. Any disruption here has immediate global consequences. Market analysts are closely tracking tanker movements. According to IG analyst Tony Sycamore, traders are waiting for signs of increased activity as a signal of easing tensions. However, current conditions suggest otherwise. The continued slowdown in shipping has kept supply concerns alive. Ceasefire Fails to Calm Market Fears Although Iran and the United States agreed to a two-week ceasefire earlier this week, fighting has reportedly continued in some areas. This has raised doubts about the durability of the truce. The conflict, which began on February 28 following airstrikes involving the United States and Israel, has already caused widespread damage. Around 50 infrastructure sites across the Gulf region have been hit by drone and missile attacks. Additionally, nearly 2.4 million barrels per day of refining capacity remain offline, according to industry estimates. These factors continue to weigh heavily on market sentiment. Traders remain cautious, unwilling to fully trust the ceasefire. Pakistan Talks in Focus as Diplomatic Efforts Intensify Attention is now shifting to Pakistan, where high-level talks between Iran and the United States are taking place. Islamabad is hosting negotiations aimed at transforming the fragile ceasefire into a lasting peace agreement. Analysts believe Pakistan will push for de-escalation. However, some question whether it holds enough leverage to secure reopening of the Strait of Hormuz. Iran has reportedly proposed charging transit fees for ships passing through the strait under any future agreement. This idea has faced resistance from Western leaders and international organisations. The outcome of these talks could play a decisive role in shaping oil market trends. A breakthrough may restore shipping flows and stabilise prices. Oil Could Hit $190 if Crisis Persists Experts warn that oil prices could surge dramatically if disruptions continue. John Paisie, president of Stratas Advisors, stated that Brent crude could reach as high as $190 per barrel under current conditions. Such a spike would have severe global consequences. Higher energy costs could drive inflation, slow economic growth, and strain economies already facing challenges. On the other hand, any improvement in shipping flows could moderate prices. Even then, analysts expect oil to remain above pre-war levels for the foreseeable future. Global Markets Brace for Uncertainty The ongoing crisis has placed global markets on edge. Investors are closely watching geopolitical developments, particularly in the Middle East. Energy security has once again become a top concern. Governments and industries are evaluating contingency plans to manage potential shortages. While diplomatic efforts offer hope, risks remain significant. The coming days will be crucial in determining whether tensions ease or escalate further. For now, oil markets remain caught between fragile peace and persistent uncertainty.
