Market News

(Bloomberg) -- Oil rallied as traders braced for any escalation of US-Iran tensions heading into the weekend, with a massive deployment of American forces in the Middle East keeping the market on edge.

Brent traded near $73 a barrel, hitting its highest since July. A person familiar with Washington’s position said the American delegation left Geneva disappointed with the progress of talks over Iran’s nuclear program, while the US, China and several other nations adivesed citizens to leave some parts of the region.

Concerns about a potential US strike on Iran have helped oil prices jump almost 20% so far this year, offseting broad expectations of a supply glut. The US military buildup is the largest in the region since the 2003 invasion of Iraq, and was ordered by US President Donald Trump as he gave the Islamic Regime limited time to strike a deal.

Odds of a US strike on Iran by March 1 surged on Friday morning, according to the Polymarket prediciton markets site. They were at 29% by the early afternoon in London, compared with 9% at 9 a.m.

Traders will also be closely watching a scheduled OPEC+ supply meeting on Sunday, as conflict risks cloud the outlook.

“OPEC+ is likely to increase oil production only slightly from April onwards, but geopolitical risks mean that there is unlikely to be any pressure on prices — for the time being,” according to a report from Commerzbank.

--With assistance from Alex Longley.