Sharp weekly drop in world oil prices on hopes of easing Middle East tensions

World oil prices have recorded their sharpest weekly decline in years on hopes that the Iran conflict will ease and Middle East oil supplies will be restored.

At Friday's market close, the international benchmark Brent crude stood at $98.32 a barrel, while US West Texas Intermediate (WTI) settled at $90.83.

Over the past week Brent fell by about 17 per cent, the steepest weekly percentage drop recorded since the COVID-19 pandemic period, and WTI fell about 13 per cent, international reports say.

Analysts say the main reason for the fall is investors' expectation that tensions in the Middle East could ease after the US midterm elections. The drop in oil prices is also expected to bring relief to import-dependent countries.

Economic circles believe the fall in international crude prices will help oil-importing countries like Sri Lanka reduce their fuel import costs.

Traders said markets will be watching diplomatic developments in the coming days for confirmation that supply routes through the region remain open.