(Investing) – Oil prices edged higher on Friday after U.S. and Iranian forces exchanged fire near the Strait of Hormuz. Despite the escalation, President Donald Trump maintained that the month-old ceasefire was still in place, with Brent crude remaining above $100 per barrel.
As of 08:30 ET, Brent Oil Futures was marginally up 0.2% to $100 per barrel, while West Texas Intermediate (WTI) crude futures rose 0.4% $95.16 per barrel.
Investors were also assessing U.S. job growth which was more than expected in April, government data showed on Friday, while the unemployment rate stayed flat. As per the the U.S. Bureau of Labor Statistics (BLS), April nonfarm payrolls edged up 115k, compared to a consensus estimate of 65k. The unemployment rate stayed at 4.3%.
Geopolitical tensions were elevated after Iran accused the U.S. of targeting an Iranian oil tanker and another vessel entering the Strait of Hormuz, as well as carrying out strikes on Qeshm Island and nearby coastal areas.
Oil was set for a 7% weekly decline as Washington and Tehran signaled a peace agreement could be near.
The U.S. military said it had acted in self-defense after Iranian drones, missiles, and small boats targeted three U.S. Navy destroyers transiting the strategic waterway. Washington said no U.S. assets were hit.
Trump sought to calm markets, describing the confrontation as “just a love tap” and telling ABC News that the ceasefire with Iran was still holding. Iranian state media later reported that conditions had returned to normal in affected areas.
Still, traders remained on edge over the risk of escalating conflict around the Strait of Hormuz, through which roughly a fifth of global oil and LNG supplies pass.
“Looking ahead, oil prices are likely to remain highly headline‑driven, with the recent escalation reinforcing the risk premium,” ING analysts said in a note.
The latest flare-up marked the most serious breach yet of the fragile ceasefire brokered in April after weeks of conflict between Washington and Tehran.
The exchange of fire happened as Washington awaited Iran’s response to the latest peace proposal. Reports showed that diplomatic efforts led by Pakistan to secure a broader agreement remain underway.
Ayushman Ojha contributed reporting
