Oil Prices Drop Amid U.S. Sanctions and Middle East Attacks

Oil prices are on track for a second consecutive weekly decline, with Brent and WTI futures expected to drop by 2%. This follows a sharp decline the previous week, where prices plunged 16% and 13% respectively. The downward trend is driven by softening U.S. demand and rising crude and fuel inventories reported by the Energy Information Administration.

Market volatility is influenced by the strategy of Donald Trump, who has prioritized economic sanctions and a blockade against Iran over intensified military operations. The U.S. president stated that "a deal with Iran was not necessary to end the war."

Despite the price drop, supply risks remain high due to regional instability. The military of Iran reported explosions hitting four oil tankers in the Strait of Hormuz. Simultaneously, Iran-aligned Houthis in Yemen claimed attacks on an Aramco building in Riyadh, an oil facility in Yanbu, and a pumping station on the Saudi East-West oil pipeline.