Oil prices rose for a third consecutive day following the United States' imposition of sanctions on a Chinese refinery, marking a significant move to restrict the supply of crude oil from Iran. Global benchmark Brent saw some gains diminish due to a strengthening dollar, but still remained above $72 per barrel, on track for its biggest weekly rise since early January. Meanwhile, West Texas Intermediate was trading below $69. The US imposed penalties on a Chinese refinery and its CEO for allegedly purchasing Iranian oil, marking the first such action by the Trump administration on China's refining sector. Additionally, a terminal operator was also sanctioned.

According to RBC Capital Markets LLC analysts, the sanctions represent an escalation of risks for oil flows in the region. While the measures do not fully impede the illicit Iranian oil trade into China, they do signal heightened risk, prompting the market to factor in a potential risk premium.

Positive US data on oil demand buoyed market sentiment this week. Nevertheless, bullish sentiment has been tempered by various negative factors such as a growing global trade dispute and the looming prospect of increased OPEC+ oil supply starting from the following month.

Some OPEC members have promised further production cuts to offset exceeding quotas. These additional reductions by countries like Kazakhstan, Iraq, and Russia are intended to counterbalance the planned increase in output until the end of next year, as stated on OPEC's official website.