Brent set for 3.4% weekly gain as US signals indefinite Iran blockade

Brent futures slipped 12 cents to $86.95 a barrel on Friday morning while US West Texas Intermediate (WTI) rose 13 cents to $81.38, but both benchmarks are heading for solid weekly gains: Brent up around 3.4% and WTI up around 4%. The moves follow a week of escalating rhetoric between Washington and Tehran, with traders pricing in a longer disruption to Middle East flows rather than a quick resolution.

The US said on Thursday it may keep its naval blockade of Iran in place indefinitely and widen economic pressure on Tehran after ceasefire talks stalled. Treasury Secretary Scott Bessent told Newsmax that further economic isolation measures were coming. Bjarne Schieldrop, chief commodities analyst at SEB Research, said the hope of a swift return to normal flows through the Strait of Hormuz currently looks absent.

What this means for UK buyers

Oil doesn't set UK gas or power prices directly, but Brent and NBP often move together when Middle East risk drives sentiment across the energy complex. If you're pricing a renewal over the next few weeks, treat this as a volatility signal rather than a reason to panic-buy: forward curves can overshoot geopolitical headlines before settling back once actual flows are confirmed.

The chart below tracks Brent over the past six months, giving readers a visual sense of how this week's 3.4% gain fits into the broader trend.

• Strait of Hormuz shipping volumes now below the monthly average
• Two Abu Dhabi National Oil Company vessels reportedly attacked in the strait on Thursday, per the UAE's WAM news agency
• US crude inventories posted their largest weekly build in over three and a half years
• OPEC forecasting weaker demand growth into next year
• Blockade duration now framed by the US as open-ended, not temporary

Reuters reported that the strait normally carries around one-fifth of the world's daily oil and liquefied natural gas shipments, so any sustained restriction there has knock-on potential for LNG-linked gas pricing in Europe, including the UK. Bloomberg separately reported that US officials now expect Iran-related supply disruptions to persist through 2027, a timeframe that, if it holds, would keep a geopolitical risk premium embedded in forward energy curves well beyond the current renewal season.

Counterbalancing the supply fears, Norbert Rucker of Julius Baer noted that storage levels tracked by the IEA and EIA are holding up better than expected, which could cap further upside. That tension between constrained Middle East flows and comfortable inventories is likely to keep oil, and by extension sentiment in gas markets, choppy rather than one-directional through the next few weeks.