Oil prices extended their gains on Friday, hitting fresh one-week highs as geopolitical tensions and upbeat economic data fueled market optimism.
U.S. President Donald Trump warned of “consequences” if Russia obstructed efforts to reach a peace deal in Ukraine, stoking concerns about potential disruptions to global crude supply. The warning comes just hours before a high-stakes meeting between Trump and Russian President Vladimir Putin in Alaska, where the ongoing war in Ukraine is expected to dominate the agenda. Continued hostilities in the region have already limited Russian oil exports, providing underlying support for prices.
Brent crude futures rose 16 cents, or 0.2%, to $67.00 a barrel as of 0017 GMT, while U.S. West Texas Intermediate (WTI) crude gained 14 cents, or 0.2%, to $64.10.
Market sentiment was further buoyed by strong economic figures out of Japan, one of the world’s largest crude importers. Government data showed the Japanese economy expanded at an annualized 1.0% in the April–June quarter, more than double the median market forecast of 0.4%. On a quarterly basis, GDP grew 0.3%, compared to expectations for a modest 0.1% rise. Economists say such robust growth could bolster oil demand in the months ahead.
However, gains in crude prices were capped by concerns over U.S. monetary policy. Higher-than-expected inflation and weaker-than-anticipated job data have heightened fears that the Federal Reserve will keep interest rates elevated for longer—a scenario that typically dampens energy consumption.
With the Trump-Putin talks set to take center stage, traders are bracing for potential market volatility depending on whether progress is made toward a Ukraine ceasefire—or if tensions flare further.