EBC Markets Briefing | ​Oil prices extend torrid rally for a third week

Oil prices pulled back on Friday though there was no sign of an exit strategy from Israel and Iran. Israel defence minister Israel Katz said that Ayatollah Ali Khamenei "cannot continue to exist."

Trump concluded a meeting Wednesday with top advisers as he weighed whether to plunge the US into the ongoing war between Israel and Iran, but the White House offered few clues about his decision.

The US is seen as being able to provide military firepower necessary to destroy Iran's underground enrichment facility at Fordow, which analysts say Israel is unable to do alone.

Adding to the encouraging headlines, US crude oil stockpiles posted their largest decline in a year in the week ending 13 June, while gasoline and distillate inventories rose, according to the EIA.

But the IEA forecast in its latest report China's oil demand will stop growing in 2027 - earlier than previously expected, reinforcing the outlook for a global peak and prolonged supply surplus this decade.

US output will keep growing, complemented by Brazil, Canada and Guyana. About 5.1 million barrels of production capacity will be added this decade, double the increase in oil demand, according to the report.

Brent crude is heading for a third straight substantial weekly gains. The price has come off the overbought territory. The uptrend remains intact but a temporary decline towards $74 cannot be ruled out.

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