Global oil prices traded cautiously higher on Friday, supported by a weaker US Dollar, even as easing geopolitical concerns in the Middle East continued to cap gains.
Brent crude hovered around $72.10 per barrel, while West Texas Intermediate (WTI) traded near $68.83 per barrel, with crude prices recovering modestly after recent declines ahead of the US holiday weekend.
A weaker US dollar supports oil prices
Oil prices found support after the latest US employment figures pointed to signs of a cooling labour market.
The data led financial markets to reduce expectations of a near-term interest rate hike by the US Federal Reserve.
A weaker US Dollar generally benefits commodities priced in the currency by making them relatively cheaper for holders of other currencies.
This provided support to WTI despite broader concerns surrounding global geopolitical developments.
According to data released by the US Bureau of Labor Statistics (BLS) on Thursday, Nonfarm Payrolls (NFP) increased by 57,000 in June.
The figure was below market expectations of 110,000.
Meanwhile, the unemployment rate declined to 4.2% from 4.3% recorded in May.
The weaker-than-expected employment report weighed on the US Dollar, helping crude prices recover part of their recent losses.
Middle East negotiations remain a key market driver
Despite the rebound, investor sentiment remained cautious as markets continued to assess diplomatic efforts between the United States and Iran.
However, the discussions showed no clear signs of meaningful progress towards achieving lasting peace.
The lack of a decisive breakthrough has kept geopolitical risks elevated. Market participants continue to watch developments closely, as any renewed tensions in the Middle East could provide additional support to crude oil prices.
Diplomatic signals offer some relief
While geopolitical risks remain, there were also signs of continued diplomatic engagement.
US President Donald Trump said on Thursday, “I think they have accepted nearly everything we require.”
His comments followed reports from Qatar, which said there had been “positive progress” after Washington and Tehran concluded indirect technical talks in Doha.
The discussions focused on issues related to the Memorandum of Understanding (MoU) signed on June 17.
The diplomatic developments helped ease some concerns over potential supply disruptions.
Crude remains under pressure despite recovery
Although WTI recovered during Friday’s session, crude oil prices remained under broader pressure.
Tanker traffic through the Strait of Hormuz continued to recover, reducing immediate concerns over disruptions to global oil shipments.
At the same time, ongoing diplomatic engagement between the United States and Iran added to expectations that supply risks could remain contained.
Brent crude also remained under pressure and was on track for its fourth consecutive weekly decline.
If confirmed, it would mark the benchmark’s longest weekly losing streak since August 2024.
For now, crude oil markets remain caught between support from a weaker US Dollar and lingering uncertainty surrounding geopolitical developments in the Middle East.
Investors are expected to continue tracking both macroeconomic data and diplomatic negotiations for further direction.
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