Rising tensions between the US and Iran prompted oil prices to rise about 1 percent on Friday after steep losses a day earlier.
Brent crude futures settled 54 cents higher at $62.47 a barrel. West Texas Intermediate crude futures rose 33 cents to end the session at $55.63 a barrel.
Prices rose late in the session after Iran said they had captured a British oil tanker in the Gulf after Britain seized an Iranian vessel earlier this month.
However, the longer-term outlook for oil has grown increasingly bearish.
Reuters reported that The International Energy Agency (IEA) does not expect oil prices to rise significantly because of slowing demand and there is a glut in global crude markets.
Middle East Markets
Stocks in the UAE outperformed most major Gulf markets, boosted by strong earnings at banks.
The Dubai index climbed 1.7 percent, driven by a 2.7 percent rise in Emirates NBD after the bank announced an 80 percent jump in second-quarter earnings.
In Abu Dhabi, the index closed 2.7 percent higher, buoyed by First Abu Dhabi Bank (FAB), which rose 4 percent to its highest level since May after posting a 5 percent rise in second-quarter net profit.
Saudi Arabia's main index fell 0.5 percent, ending eight straight days of gains triggered by EFG Hermes forecasting that profits for the kingdom's financial sector would grow 7.6 percent in the second quarter.
Qatar's index dropped over 1 percent with 17 of 20 stocks declining. Commercial Bank plunged 4.5 percent and Industries Qatar lost 1.5 percent.
Egypt's blue-chip index advanced 0.2 percent, with Cairo Investment and Real Estate Development jumping 6.8 percent.
Global stocks declined on Friday after big rate cut hopes by the US Federal reserve faded.
Major indexes plunged after Wall Street Journal reported the Fed is likely to cut rates by 25 basis points when it meets later this month, after comments by a Fed official on Thursday raised expectations a larger cut may be on the cards.
The Dow Jones Industrial Average fell 68.77 points, or 0.25 percent, to 27,154.2, the S&P 500 lost 18.5 points, or 0.62 percent, to 2,976.61 and the Nasdaq Composite dropped 60.75 points, or 0.74 percent, to 8,146.49.
China and Hong Kong stocks followed Asian shares higher on Friday, after a comment from top Federal Reserve official cemented expectations of a US interest rate cut later this month.
The CSI300 index rose 1.3 percent to 3,815.95 points at the end of the morning session, while the Shanghai Composite Index gained 1 percent to 2,930.58 points.
The Hang Seng index added 1.1 percent to 28,772.46 points, while the Hong Kong China Enterprises Index gained 1.4 percent to 10,929.72.
Middle East tensions and prospects of lower interest rates in the US kept gold on track for a second week of gains. However, the yellow metal eased on Friday as investors booked profits after prices raced past $1,450 an ounce to hit a six-year peak.
Spot gold shed 0.6 percent to $1,437.51 by 1151 GMT, having touched its highest since early May 2013 at $1,452.60.
"But gold is still looking good. The interest rates and dollar environment, uncertainties over the U.S.-China trade war and now the geopolitical situation being the icing on the cake; all of this has created a very supportive environment for gold," Reuters quoted Mitsubishi analyst Jonathan Butler as saying.
Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, rose 1.4 percent to 814.62 tonnes on Thursday from 803.18 tonnes the previous day.
Among other precious metals, platinum gained 1 percent to $857.73 while palladium gained 0.2 percent to $1,528.29.
Silver slipped 0.2 percent to $16.30 and was on track for its best week since July 2016, having gained nearly 7 percent.
The US dollar rose in afternoon trade on Friday after the Federal Reserve walked back dovish comments from its president the prior day.
The dollar remains sensitive to any Fed news "as traders are positioned for at least three rate cuts by year-end including the 25-basis point cut that is fully priced into the market this month," Reuters quoted Joshua Tadbir, corporate hedging manager at Western Union Business Solutions as saying.
The euro fell against the rebounding US dollar on Friday and hit a 2-year low versus the Swiss franc, as investors ramped up bets for a European Central Bank interest rate cut as early as next week.
The Japanese yen dropped against the dollar, falling 0.35 percent to 107.64.
(Writing by Seban Scaria firstname.lastname@example.org, editing by Mily Chakrabarty)
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