Oil drifted in thin end-of-year trading, with investors assessing the outlook for 2025 while tracking developments in the Middle East.
West Texas Intermediate steadied below $70 a barrel, after shedding 0.7% on Thursday, when Brent also settled lower. A gauge of 10-day volatility for the US crude benchmark has ebbed to the lowest since 2021.
In the Middle East, Israel struck targets in Yemen that it said were controlled by Houthis, the last of the Iran-backed groups still fully engaged in the regional war that began 14 months ago. The rebels have been menacing shipping in the Red Sea, forcing tankers onto longer routes around southern Africa.
Crude is on track for a modest annual loss, although trading has been confined in a narrow band since mid-October. There are widespread concerns the market may be oversupplied next year as China’s demand slows and global supplies expand, although traders remain cautious about potentially tighter US sanctions against flows from Iran under Donald Trump’s presidency.
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