DTN Oil Update
Oil Futures Mixed as US Warns of Further Iran Sanctions
HOUSTON (DTN) -- Oil prices settled mixed on Friday on thin trading as market participants remained on a wait-and-see position as the Trump administration has threatened to place tougher sanctions on Iran, potentially affecting further oil flows from the Middle East.
Iran has intensified attacks on commercial ships seeking to transit the Strait of Hormuz outside of corridors approved by Tehran, pushing daily traffic through the key energy chokepoint back into the single digits. This compares with a pre-war average of 130 crossings per day.
The latest escalation came midweek, when the U.S. announced plans for sweeping economic sanctions on Iran. U.S. President Donald Trump said in a social media post that Washington would pursue "economic warfare and isolation" against Tehran and threatened countries that continue trading with Iran with severe economic consequences. Tehran on Friday warned against such measures, saying that their response would be "crushing, punishing and devastating." Separately, U.S. Treasury Secretary Scott Bessent said that he would share details about the planned sanctions package on Monday, Aug. 24.
The bullish sentiment in the oil futures market has also been fueled by Ukrainian attacks on Russian refineries, which have disrupted approximately from 20 to 40% of the country's refining capacity, resulting in fuel shortages and export transactions.
Domestically, North American energy drilling activity retracted this week, Baker Hughes' weekly rotary rigs report released Friday, Aug. 21, showed, with the regional count falling by eight to 804. Year on year, rigs for Canada and the United States combined were up 86 from the 718 actively deployed in the exact same week of 2025.
The front-month NYMEX WTI remained unchanged at $86.83 bbl from the previous trading session, while ICE Brent for October delivery edged up $0.25 to $94.03 bbl.
In contrast, NYMEX ULSD futures for September delivery fell $0.0033 to $4.4770 gallon, and front-month RBOB futures rising by $0.0693 to $3.3322 gallon.
The U.S. Dollar Index continued lower, down 0.063 points to a three-month low 98.75 against a basket of foreign currencies.
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