Live updates: Follow the latest news on Iran war
Global oil prices reversed gains on Friday, but are still on track for a sharp weekly gain, as tensions simmered in the Strait of Hormuz due to uncertainty surrounding peace negotiations between the US and Iran.
Brent, the benchmark for two-thirds of the world's oil, gave up 0.54 per cent to $104.50 a barrel at 4.08pm UAE time. West Texas Intermediate, the gauge that tracks US crude, retreated 1.25 per cent to $94.65 per barrel.
Brent and WTI were up by nearly 2 per cent earlier in the day, nearing the $110 and $100 levels, respectively. Brent surpassed the $100 mark again on Wednesday, after topping it amid the war.
From last Friday's close, both Brent and WTI are on pace for a surge of about 15 per cent. Year-to-date, they are up 73 per cent and 65 per cent, respectively.
Washington and Tehran have traded accusations of ceasefire breaches over the past week, prolonging a conflict that is about to enter its ninth week without any clear endgame or clarity on talks.
Both sides are also gearing up for another possible clash in the Strait of Hormuz, which has been a flashpoint throughout the hostilities. The waterway is a key chokepoint for about a fifth of the world's oil shipments.
Crude has swung wildly in recent days, dropping last Friday after the US and Iran declared the Strait of Hormuz open. However, Tehran on Saturday said the waterway was closed again, and accused Washington of breaching certain aspects of the ceasefire.
Brent hovered around the $100 mark on Tuesday, before going over that mark again on Wednesday as Mr Trump insisted he would not extend the truce with Iran, which was to lapse that day.
He eventually agreed to do so before the ceasefire expired, after a request from Pakistan, which has been acting as mediator for the two sides.
Meanwhile, the ceasefire between Israel and Lebanon is to be extended by three weeks, and the countries' leaders will meet soon in Washington, US President Donald Trump said on Thursday.
Matt Stanley, a head of market engagement at industry tracker Kpler, said oil prices so far in April have been "bookends" - starting at around $105, diving to around $90 by mid-month and back around $105 - which also throws range guesses into question.
"It’s not a new range. A range implies that the market is aware where the respective floors and ceilings are ... but honestly, I don’t think anyone has a clue where those are right now, and I certainly don’t think anyone wants to guess," he wrote in a note on Friday.
"The Strait of Hormuz needs to reopen, and reopen properly, unencumbered, with proper insurance and logistical modus operandi in place. It is that simple."
Also, crude oil production shut-ins in the Middle East, particularly in Saudi Arabia, Iraq and Kuwait, have reduced associated natural gas production, the International Energy Agency said in a quarterly report released on Friday.
The region accounts for almost 30 per cent of global oil output and 18 per cent of gas production, estimates from the Paris-based IEA show.
"The impact of higher oil prices [on gas production] is expected to become more pronounced in the latter part of the year," analysts at the IEA wrote.
