Oil prices dropped for a third straight session on Friday, offering some relief to a global economy that has been paying sharply higher energy costs for months.
Brent crude, the international benchmark, fell about 2.2% to $102.57 a barrel, while U.S. West Texas Intermediate slid nearly 2% to just above $100, briefly dipping under that mark during the session. Both benchmarks are still far above where they stood a year ago, but traders were encouraged by news that Saudi Arabia is moving to repair a damaged pipeline that carries crude across the kingdom to its Red Sea coast, with officials aiming to restore roughly half of its capacity within days. That route matters because it lets Saudi oil reach world markets without passing through the Strait of Hormuz, the narrow waterway between Iran and the Arabian Peninsula that carries a large share of the world's seaborne oil.
The backdrop is a tense one. Iran and the United States, along with Israel, have been in a state of active military confrontation this year, and Iran has carried out missile and drone strikes against several countries in the region that it says host American interests or bases. Shipping through the Strait of Hormuz has continued, though insurers and shipowners have grown more cautious, and some tankers now transfer cargo outside the strait to limit their time in contested waters. Saudi Arabia's energy infrastructure has also come under attack from Yemen's Houthi movement, which Riyadh accused this week of trying to strike near Islam's holiest sites, a claim that drew condemnation from governments across the region.
Diplomacy is continuing alongside the military activity. Reports indicate China has encouraged Iran to help rein in Houthi attacks on Saudi energy facilities, following an appeal from Riyadh, while President Trump has said he is weighing further options regarding Iran ahead of a planned meeting with Gulf leaders in New York next week. For now, markets are reading the pipeline repair and continued tanker traffic as signs that global oil supply can hold up even amid the disruption, which is why prices have eased even as the underlying tensions remain unresolved.
Saudi officials say they hope to have about half the pipeline's capacity restored within days; how quickly that happens, and whether Strait of Hormuz shipping stays uninterrupted, will shape whether oil keeps easing or snaps back higher.
Why does the Strait of Hormuz matter for oil prices?
It is a narrow waterway between Iran and the Arabian Peninsula that a large share of the world's seaborne crude oil passes through, so any disruption there affects global supply and prices.
Is oil still expensive compared with a year ago?
Yes. Even after three days of declines, prices remain far higher than a year earlier because of the ongoing regional tensions.