📈 Global Oil Surge: Brent Set for ~10% Weekly Gain Amid Middle East Tensions

Global oil benchmarks eased on Friday after snapping multi-day winning streaks, but remain on track for strong weekly gains as escalating Middle East hostilities raise fears of prolonged energy supply disruptions. • Market Prices & Daily Movement • Brent Crude: Down 3.58% to US$ 103.78/bbl on Friday after peaking at US$ 108/bbl on Thursday. • WTI Crude: Down 2.17% to US$ 99.23/bbl on Friday after hitting over US$ 104/bbl earlier. • Weekly Trajectory: Brent set for an 8.4% weekly gain (closing above US$ 100/bbl for the first time since mid-May); WTI up 9.2% week-to-date. • Geopolitical Drivers & Global Impact • Extended Conflict: Markets are pricing in a protracted war involving Iran, supported by reports of U.S. discussions on conflict duration extending beyond current presidential terms. • Price Horizon: Expectations point to sustained pressure on energy costs until political or diplomatic resolutions emerge. • Macroeconomic Relevance for Sri Lanka • Import Costs & Inflation: Higher global crude prices directly impact net-energy-importing nations like Sri Lanka by swelling national fuel import bills and pressuring trade balances. • Sector Vulnerabilities: Elevated fuel and energy costs increase production overheads across critical export sectors like apparel & textiles and operational costs in tea manufacturing and logistics, underscoring the vital need for national energy security and efficiency.