Oil prices rose to a three-month high on Friday, with traders digesting new sweeping sanctions on Russia as the Biden administration tries to cut off Moscow from crude revenues amid the ongoing war in Ukraine.
West Texas Intermediate crude (CL=F) rose more than 3.5% to settle at $76.57 per barrel, while Brent crude futures (BZ=F), the international benchmark price, briefly reached $80 before they settled at $79.76, the highest level since October.
More than 180 ships, two oil companies, traders, insurers and top Russian officials were named in the sanctions.
“The United States is taking sweeping action against Russia’s primary source of revenue to finance its brutal and illegal war against Ukraine,” Treasury Secretary Janet Yellen said in a statement.
Oil prices have been on an upward trend since late December, with traders unsure about newly elected President Donald Trump’s policy towards Iran. Tehran currently produces more than 3 million barrels of crude oil per day.
‘The news keeps trickling in [the] The Trump administration’s tough stance on Iran could come very soon,” Dennis Kissler, senior vice president at BOK Financial, wrote in a note to clients on Friday.
“When you add in freezing temperatures in most of the US, along with declining storage numbers, crude oil has now become a new ‘fund favorite,’” he added.
JPMorgan analysts said global oil demand is expected to remain strong through January due to colder-than-expected weather in the Northern Hemisphere, boosting heating fuel use, and early travel activity in China for the New Year’s holiday country.
Despite Friday’s sharp rise, many analysts expect oil prices to be lower this year than in 2024.
“Despite ongoing geopolitical conflicts, a combination of bearish factors are likely to keep oil prices structurally low through 2025, with a likely price range of $60-$80 per barrel for Brent spot oil. That would be lower than the $70-$90 per barrel that dominated 2024,” Eurasia Group wrote in a note on Thursday.
Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on X @ines_ferre.
Click here for an in-depth analysis of the latest stock market news and events affecting stock prices
Read the latest financial and business news from Yahoo Finance
