Oil prices settled higher on Friday, but the gains failed to offset steep weekly losses, as fading hopes for a quick reopening of the Strait of Hormuz gave way to renewed supply concerns. Brent crude settled up 1.29% at $83.55 a barrel, while US West Texas Intermediate rose 1.15% to $78.18. On the week, Brent fell 5.02% and WTI lost 7.67%, according to settled exchange data.

The week was marked by violent swings. Prices dropped early on optimism over a potential deal between Iran and Oman to reopen the strait, then jumped on Thursday after Iran reviewed a bill to ban US and Israeli vessels from the waterway. The proposed arrangement faces significant hurdles. Iran is seeking transit fees of 5% to 7% of cargo value, Oman is discussing roughly 3%, and Washington is insisting on no fees at all. Analysts note that the current structure gives Tehran too much leverage for President Donald Trump to accept politically, while four industry sources say US sanctions and restrictive insurance clauses make the deal difficult to implement.

Regional tensions compounded the supply picture. Houthi rebels in Yemen claimed new attacks on Saudi Arabia, and a Ukrainian drone strike reportedly set fire to a major Russian refinery, adding to worries about shipping routes and supply disruptions. The strait normally carries about a fifth of the world's oil and liquefied natural gas, keeping the market highly sensitive to any sign of restriction.

Investors were also awaiting US non-farm payroll data due later on Friday for clues on interest rates, which influence fuel demand. The focus shifts next week to US inflation figures and the latest reports from the Energy Information Administration, OPEC, and the International Energy Agency. Until tangible signs emerge - such as tankers returning to the strait and insurance premiums falling - the market will continue to price in a fragile truce rather than a definitive end to the conflict.