Brent crude climbs for fifth straight week as U.S. sends more troops to Middle East

[Data analyzing in commodities energy market: the charts and quotes on display. US WTI crude oil price analysis. Stunning price drop for the last 20 years.]
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Brent crude oil futures rose nearly 9% this week, posting their highest settlement in nearly four years, while U.S. crude finished the week with a small loss, as Iraq declared force majeure on its oilfields developed by foreign oil firms and the U.S. said it is sending three warships and thousands of additional Marines to the Middle East.

Up to 2,500 Marines from the USS Boxer amphibious ready group and 11th Marine Expeditionary Unit are heading to the Middle East, the second large deployment of Marines in the past week, after the Pentagon sent the 5,000-strong USS Tripoli and 31st Marine Expeditionary to the region.

The news comes a day after President Trump said he had no plans to put American troops on the ground in Iran.

"Crude is closing out another volatile, headline-driven week, with strength into the weekend as traders trim short exposure," CIBC Private Wealth senior energy trader Rebecca Babin said in a note. "Today’s move higher reflects worsening rhetoric from Iran, limited evidence of flows through the Strait, and unconfirmed reports that Kharg Island could be in play alongside increased military positioning in the region."

After hours, Trump posted on Truth Social that the U.S. is "getting very close to meeting our objectives as we consider winding down our great Military efforts in the Middle East."

As the war continues to disrupt energy flows through the Strait of Hormuz, strategists at RBC Capital Markets are watching for any signs that the Houthis may enter the fray, imperiling the Red Sea export route that Saudi Arabia and some others could use as an alternative to the strait; for now, the Houthis have stayed on the sidelines, unlike in 2019, when they targeted the East-West pipeline and joined the Iranian strike on Abqaiq.

"If the Yemeni group does become an active participant, we think it would materially alter risk perceptions about the Red Sea exports," RBC said in a note, adding that even a few missiles or drones fired into the Bab el-Mandeb Strait would push oil prices several legs higher in the current environment.

The Brent-WTI spread widened sharply this week, reaching its highest level in more than a decade, as the severe disruptions in the Strait of Hormuz and attacks against key energy infrastructure in the Persian Gulf region raise fears of supply shortages, while the U.S. WTI oil gauge remains more insulated, reflecting domestic supply conditions.

This week, front-month Brent crude (CO1:COM [https://seekingalpha.com/symbol/CO1:COM]) for May delivery jumped 8.7% to $112.19/bbl, its fifth consecutive weekly gain and best settlement value since July 4, 2022, but front-month Nymex crude (CL1:COM [https://seekingalpha.com/symbol/CL1:COM]) for April delivery lost 0.4% to $98.32/bbl.

Also this week, front-month Nymex ULSD (HO1:COM [https://seekingalpha.com/symbol/HO1:COM]) for April delivery surged 14.8% to $4.6084/gal, the highest settlement value since April 29, 2022, and front-month Nymex RBOB gasoline (XB1:COM [https://seekingalpha.com/symbol/XB1:COM]) for April delivery gained 8% to $3.2862/gal, its best settlement value since July 29, 2022.

Front-month Nymex natural gas (NG1:COM [https://seekingalpha.com/symbol/NG1:COM]) for April delivery gained 1.1% this week to $3.095/MMBtu, while European benchmark gas surged ~20% for the week, reaching its highest level since 2022 after Qatar reported severe damage to the world's largest LNG plant.

On Friday, Brent crude rose 3.2%, Nymex crude added 2.3%, and U.S. natural gas fell 2.2%.

Several energy stocks posted new 52-week high on Friday, including Cheniere Energy Partners (CQP [https://seekingalpha.com/symbol/CQP]), Chevron (CVX [https://seekingalpha.com/symbol/CVX]), ConocoPhillips (COP [https://seekingalpha.com/symbol/COP]), Crescent Energy (CRGY [https://seekingalpha.com/symbol/CRGY]), EOG Resources (EOG [https://seekingalpha.com/symbol/EOG]), Exxon Mobil (XOM [https://seekingalpha.com/symbol/XOM]), Halliburton (HAL [https://seekingalpha.com/symbol/HAL]), Helmerich & Payne (HP [https://seekingalpha.com/symbol/HP]), Kosmos Energy (KOS [https://seekingalpha.com/symbol/KOS]), Magnolia Oil & Gas (MGY [https://seekingalpha.com/symbol/MGY]), Matador Resources (MTDR [https://seekingalpha.com/symbol/MTDR]), Murphy Oil (MUR [https://seekingalpha.com/symbol/MUR]), Natural Gas Services (NGS [https://seekingalpha.com/symbol/NGS]), Occidental Petroleum (OXY [https://seekingalpha.com/symbol/OXY]), Ovintiv (OVV [https://seekingalpha.com/symbol/OVV]), Par Pacific (PARR [https://seekingalpha.com/symbol/PARR]), Pembina Pipeline (PBA [https://seekingalpha.com/symbol/PBA]), Permian Resources (PR [https://seekingalpha.com/symbol/PR]), Sunoco LP (SUN [https://seekingalpha.com/symbol/SUN]), Talos Energy (TALO [https://seekingalpha.com/symbol/TALO]), Vaalco Energy (EGY [https://seekingalpha.com/symbol/EGY]), Vermilion Energy (VET [https://seekingalpha.com/symbol/VET]), YPF (YPF [https://seekingalpha.com/symbol/YPF]).

ETFs: (USO [https://seekingalpha.com/symbol/USO]), (BNO [https://seekingalpha.com/symbol/BNO]), (UCO [https://seekingalpha.com/symbol/UCO]), (SCO [https://seekingalpha.com/symbol/SCO]), (USL [https://seekingalpha.com/symbol/USL]), (DBO [https://seekingalpha.com/symbol/DBO]), (DRIP [https://seekingalpha.com/symbol/DRIP]), (GUSH [https://seekingalpha.com/symbol/GUSH]), (USOI [https://seekingalpha.com/symbol/USOI]), (UNG [https://seekingalpha.com/symbol/UNG]), (BOIL [https://seekingalpha.com/symbol/BOIL]), (KOLD [https://seekingalpha.com/symbol/KOLD]), (UNL [https://seekingalpha.com/symbol/UNL]), (FCG [https://seekingalpha.com/symbol/FCG]), (XLE [https://seekingalpha.com/symbol/XLE])

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