Oil prices took a hit as the possibility of a U.S. strike on Iran diminished, leading to a decline in Asian trade on Friday. This follows a week of heightened tensions and price spikes due to protests in Iran and the threat of military action by the U.S. President. However, late Thursday brought relief as President Trump announced that Iran's crackdown on protesters was easing, reducing the likelihood of military intervention and potential supply disruptions. Despite this, oil prices remain volatile, with analysts predicting continued uncertainty due to the political situation in Iran. The market's sentiment is currently driven by geopolitical risks and speculation, but the underlying supply dynamics remain stable, according to Phillip Nova's senior market analyst, Priyanka Sachdeva. She suggests that oil prices are likely to hover between $57 and $67 per barrel in the near term, unless there's a significant change in Chinese demand or physical barrel flows. Meanwhile, the Organization of the Petroleum Exporting Countries (OPEC) forecasts a balanced oil market in 2026, with demand growth expected to continue at a similar pace as this year. Shell, a major oil company, released its 2026 Energy Security Scenarios, predicting a 25% increase in primary energy demand by 2050. This bullish outlook highlights the ongoing importance of oil in the global energy landscape.
