Oil Prices Hold Steady as Market Weighs Geopolitics, Rising U.S. Stocks

Front-month oil futures showed little change in Friday afternoon trading, with West Texas Intermediate (WTI) crude gaining just three cents to settle at $77.32 per barrel, according to live price data. The global benchmark, Brent crude, dipped two cents to $82.47.

The muted price action belies ongoing market tension centered on the protracted U.S.-Iran war and its impact on Middle Eastern oil flows. According to a report from OilPrice.com, banking giant Citi has raised its third-quarter Brent forecast to $80 per barrel from $75, citing the prolonged conflict which has kept geopolitical risk elevated. The bank's analysts noted that shipping through the critical Strait of Hormuz remains heavily constrained, supporting prices.

However, Citi maintains a bearish view for later this year, leaving its fourth-quarter Brent forecast unchanged at $70 and predicting a 2027 average of $65. This outlook hinges on an anticipated resolution to the Hormuz blockade. Other banks, like Goldman Sachs, are more bullish, suggesting Brent could remain between $80 and $90 until there is clarity on the conflict, with potential for spikes to $120 if the strait stays closed.

Adding downward pressure on prices was a reported build in U.S. commercial crude inventories. Data from the Energy Information Administration (EIA) showed stocks, excluding the Strategic Petroleum Reserve, rose to 407.0 million barrels as of July 31, according to Rigzone.

For Bakken shale operators, the price of crude at the wellhead is a key determinant of drilling economics. The live data shows the Bakken differential—the discount at which Bakken crude trades versus WTI at the Cushing, Oklahoma hub—stood at -$3.42 on Friday. A narrower discount, compared to historical averages, helps improve netbacks for North Dakota producers. The current price environment, with WTI holding above $77, combined with a manageable differential, provides a stable, if not spectacular, backdrop for production and hedging decisions in the Williston Basin.

The market appears caught between bullish geopolitical supply risks and bearish inventory data and long-term demand forecasts. For now, prices are finding equilibrium, but the path for the remainder of 2026 remains highly dependent on developments in the Middle East and the timing of any potential return of blocked oil volumes to the global market.