Crude prices tracked their second straight week of gains after touching triple-digit highs this week, driven by intense Middle East military friction, shrinking US inventories, and rising Chinese physical demand.
West Texas Intermediate settled at $99.99 per barrel, up from $91.24/bbl the previous week, while Brent closed at $104.50/bbl, up from $95.83/bbl a week earlier.
Both Brent and WTI futures contracts gained about 9% on a weekly basis.
"Oil's resilience reflects a market now repricing both the duration and severity of the conflict, along with a clearer recognition of the mounting threat to regional supply," ING analysts said.
However, analysts said supplies remain constrained. "And while meaningful volumes are still moving through the Strait of Hormuz, flows remain well below pre-war levels, underscoring how fragile the situation has become," ING added.
The broader upward run was heavily driven by intensifying geopolitical friction in the Middle East, including a massive wave of tit-for-tat maritime attacks between US and Iranian forces in and around the Strait of Hormuz.
Satellite images and reports confirmed smoke near Saudi Arabia's East-West pipeline following Houthi drone and missile attacks on civilian and energy assets in cities like Abha, Jazan, and Najran, which caused fires and temporary shutdowns.
Compounding regional supply anxieties, US military strikes targeted Iranian tankers near Kharg Island and the port city of Jask, while Washington rolled out new sanctions targeting networks aiding Hezbollah and Kata'ib Hezbollah.
On the supply and inventory front, the Energy Information Administration reported that US commercial crude inventories fell by 400,000 barrels to 424.1 million barrels for the week ending Sept. 4.
The EIA separately noted that US distillate fuel inventories are projected to drop below the 100 mmbbl mark in September and remain beneath five-year lows through much of 2027, driven by strong export demand.
Meanwhile, the US oil rig count increased by one from 449 the previous week to 450 in the week ending Sept. 11, according to data from Baker Hughes (BKR) released Friday. The US had 416 oil rigs in operation a year earlier.
The consolidated North American oil and gas rig count, a key early indicator of future production levels, increased by six to 798 from 792 the previous week.
Money managers in the WTI crude futures and options markets boosted their net long positions in the week ended Sept. 8, according to the Commodity Futures Trading Commission's latest Commitments of Traders report released Friday.
The data showed that money managers reported 218,960 long positions, up 7,851 from Sept. 1, while short positions fell 3,790 to 107,229, lifting their net long position by 11,641 contracts to 111,731.
The International Energy Agency on Friday said a full recovery in Middle East supplies is not expected before 2027, projecting average global oil supplies to fall by 5.7 million barrels per day in 2026.
In its monthly oil market report for September, the agency revised its 2026 average global oil supply forecast to 100.7 million b/d, 1.3 million b/d lower than in its previous report.
Meanwhile, demand signals from Asia provided further support as independent Chinese refiners ramped up refinery run rates.
In response to strengthening global energy markets, China's National Development and Reform Commission announced plans to raise retail fuel prices while keeping hikes below official ceilings to protect consumers, several media outlets reported.
Political commentary also shaped sentiment, with US President Donald Trump saying during a press gaggle at Joint Base Andrews that elevated crude prices could persist through the midterm elections before tumbling toward sub-$2 gasoline levels once the conflict subsides.