Geopolitical Risk Premium Returns as Crude Posts Biggest Weekly Gain in Months

AI Summary

WTI crude oil prices surged over 11% this week, marking the biggest weekly gain in months due to renewed geopolitical tensions and military action between the US and Iran. The market shifted focus back to supply risk after recent optimism over oil flows through the Strait of Hormuz dampened prices.

September WTI crude oil posted its strongest weekly gain in months, rallying over 11% as traders rapidly rebuilt a geopolitical risk premium into the market. After opening the week near $72.50, prices climbed above $80 before easing slightly into Thursday's close. The move marked a dramatic reversal from the previous two weeks, when optimism over improving oil flows through the Strait of Hormuz had pressured prices lower. This week, renewed military action between the United States and Iran shifted the market's focus back to the risk of supply…