Oil prices retreated on Friday, giving back some of the previous session's sharp gains, after U.S. President Donald Trump indicated that Washington would not strike Iran before the November midterm elections. Brent crude fell approximately 1.3% to $102.91 per barrel in Asian trading, while West Texas Intermediate slipped to around $90.40.
The pullback follows Thursday's surge, when Brent jumped 4.1% to $104.28 and WTI climbed 3.6% to $91.49, with both benchmarks gaining more than $5 intraday. The reversal suggests traders are unwinding the most aggressive escalation bets, though it does not signal that the $100 Brent problem has disappeared.
Trump's Pledge Removes One Risk, but Hormuz Remains a Larger Concern
Trump said the U.S. was holding productive discussions with Tehran and would not attack Iran before November 3, directly countering reports that the Pentagon was preparing options for renewed military operations, including strikes on Iranian energy and infrastructure targets.
Yet the physical threat to supply persists. At least nine vessels were hit around the Strait of Hormuz in the week through October 5, according to UN data, and crude flows through the waterway have fallen sharply from late-September levels. Hani Abuagla, senior market analyst at XTB MENA, noted that continuing Middle East shipping risks should keep crude elevated even if the immediate threat of a U.S. strike recedes.
Hurricane Disruption Keeps WTI Supported Near $90
Closer to home, Hurricane Isaias has forced operators in the Gulf of Mexico to shut about 1.28 million barrels per day of crude production, equivalent to 62.9% of current offshore output, according to the Marine Minerals Administration. That disruption should be temporary if offshore infrastructure escapes significant damage, making it less durable than the Hormuz risk.
Ole Hansen of Saxo Bank, in comments carried by Financial Express, said the broader market remains unusually tight, pointing to surging shipping costs and exceptionally high diesel and jet-fuel benchmarks as evidence that crude availability is only part of the problem.
$100 Oil Remains an Inflation and Rates Problem
Even after Friday's retreat, Brent remains above a level that is uncomfortable for central banks and bond investors. The U.S. 10-year Treasury yield reached about 5.34% this week, its highest since 2002, as higher energy prices revived concerns that inflation could remain sticky. Scotiabank strategists argued that the oil spike was feeding directly into global rates, with WTI above $90 adding to pressure on long-term yields.
Fundamentals also suggest $100 Brent is not purely a war premium. The U.S. Energy Information Administration this week raised its fourth-quarter Brent forecast to an average of $105, citing constrained Middle East flows, falling inventories, and tight diesel markets. The International Energy Agency is accelerating emergency stock releases, with roughly another 100 million barrels still available under its March programme.
This article is for informational purposes only and does not constitute financial advice.
