Crude oil prices exhibited a choppy trading pattern on Friday, with market activity subdued ahead of the US Labor Day long weekend. The market navigated a complex dynamic: renewed skirmishes between the United States and Iran stoked supply concerns on one hand, while a rare glimmer of hope for an end to the Russia-Ukraine war tempered geopolitical risk premiums on the other. West Texas Intermediate (WTI) crude ultimately edged up 0.2% to settle near $91.50 per barrel, though trading volumes were notably thin as investors hesitated to establish significant positions given the prevailing uncertainty surrounding the US-Iran conflict.
Rebecca Babin, a senior energy trader at CIBC Private Wealth Group, attributed the muted price action to a confluence of factors. "The military front was relatively quiet overnight," she noted, "which diminished the upward momentum for oil prices." She elaborated that this was compounded by profit-taking following the week's robust gains and a general lack of liquidity in the market, creating a challenging environment for crude.
Adding further downward pressure was news that Ukrainian President Volodymyr Zelensky indicated US President Donald Trump's special envoys, Steve Witkoff and Jared Kushner, would travel to Moscow before visiting Ukraine for talks aimed at ending the war. Recent attacks by Ukrainian drones on Russian energy infrastructure have been a significant focus for the energy market, and any progress toward a ceasefire could alleviate some of the supply-side concerns embedded in prices.
Despite these headwinds, crude was still poised for a substantial weekly gain of 9.7%. This upside was driven by the escalating situation in the Middle East, where US bombing raids on Iran and subsequent retaliatory strikes on American bases have complicated the prospects for restoring shipping traffic through the Strait of Hormuz, a critical artery for global oil flows. On the New York Mercantile Exchange, WTI futures for October delivery settled 0.2% higher at $91.48 per barrel, while November Brent crude rose 0.8% to close at $96.28 per barrel.