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Oil prices extend gains amid ongoing Middle East tensions

Crude oil futures (CL=F, BZ=F) extended gains Friday, marking another week of gains amid the ongoing Middle East conflict and concerns about whether global supply will be impacted. With various pressures due to changes in routes for ships, and production lapses due to conflicts, Yahoo Finance Senior Business Reporter Ines Ferré takes a closer look at what is happening, and what to expect.

For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live.

Editor's note: This article was written by Eyek Ntekim

Video transcript

- Crude futures have been steadily climbing as persistent tensions in the Middle East show no signs of abating. Our very own Ines Ferre is here, tracking those moves in oil, Enes.

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INES FERRE: Yeah, Brad. And we are looking at WTI that's above $77 per barrel. Brent crude also above $82 per barrel. A couple of developments this week. One is that Israel rejected the proposal from Hamas for a ceasefire, calling it delusional, basically.

So this has been lifting oil prices because that area, the Middle East area tensions, there's no clear signs of when those tensions will be abating, will be stopping. You've got also the Red Sea issues with cargo ships that are avoiding that Red Sea.

And also, the Strait of Hormuz, which is near Iran. Remember also that Iran produces more than 3 million barrels of oil a day. So were any of that to be knocked off, you would see higher oil prices. I do also want to mention the EIA data that came out this week, basically lowering its growth forecast for US oil production.

Those high levels that we saw in December 2023, the EIA isn't forecasting that to come again until February 2025. So that concern that we saw in the market about, perhaps, oversupply in the market this year, that concern is abating with those forecasts.

I just want to pull up a year to date chart for WTI and for Brent crude. WTI up more than 9%. Remember we started the year kind of bearish when it came to oil, but really solidly above that $75 threshold that we had been watching for so long. And Brent crude solidly above the $80 threshold, up more than 8% year to date, guys.

- All right, Ines, thanks so much for tracking the moves there and bringing them our way. We appreciate it.