Crude oil prices set for weekly gains after Iran warnings, no war off-ramp

Crude oil prices have extended their gains in early Asia trading on Friday, March 13, after hardline comments from both US President Donald Trump and Iran's new Supreme Leader Mojtaba Khamenei.

Brent Crude closed above the mark of $100 for the first time since 2022, while the West Texas Intermediate (WTI) gained as much as 2.2% to $97.85 per barrel, setting itself on course for another weekly advance.

In his first public comments after becoming the Supreme Leader, Mojtaba Khamenei said that Iran will seek to ensure that the critical waterway, the Strait of Hormuz, remains shut for oil and gas supply. In television comments translated by Reuters, Khamenei said that Iran will either seek compensation for the destruction caused, or will destroy assets of "enemies" accordingly.

Khamenei's comments came as US President Trump wrote on Truth Social that preventing Iran from having a nuclear weapon and being a threat to the Middle East is of "far greater interest and importance to me" than the cost of oil.

In an interview to CNBC, US Energy Secretary Chris Wright said that the US navy is not ready yet to escort ships safely through the Strait of Hormuz, but is working on a plan to do so by the end of the month. Wright had earlier put a post on social media that the US navy had safely escorted a ship across the narrow maritime route, leading to a drop in oil prices, but swiftly deleted the same, prompting an official denial from the White House.

WTI has traded in a band of about $43 this week, the widest range since the depths of the pandemic when prices turned negative. Brent has swung in a range of around $38. Wild swings have being exacerbated by financial flows from options markets to exchange-traded funds.

(With Inputs From Agencies.)