The modest size of Friday's move, given the scale of the overnight escalation, suggests the market has already absorbed much of the risk from a broadening conflict that now touches Jordan, Bahrain and Kuwait alongside Iran itself. With both benchmarks already up close to 12% on the week, further headline-driven spikes look increasingly likely to fade quickly unless an actual chokepoint closure materializes. The compounding threat, a broken Hormuz truce alongside Iran's readiness to shut the Red Sea route, keeps a structural risk premium embedded in price even as the day-to-day moves stay comparatively contained.---Crude ticks only modestly higher even as the US-Iran conflict spreads to three more countries, suggesting the market has already priced in an escalation of this scale.Summary:Brent crude rose around $1, or roughly 1.25%, to about $85 a barrel, while WTI rose a similar amount, or about 1.3%, to around $80, erasing the prior session's losses.Both benchmarks are up close to 12% this week, with Brent on track for a third straight weekly gain and WTI for a second.The US launched two large waves of air strikes on Iran in a single day on Wednesday, the first time it has done so since last month's truce, and continued strikes through Thursday.CENTCOM said US forces began a new wave of strikes for a sixth consecutive night aimed at further degrading Iranian military capabilities.Overnight, US strikes also hit three bridges near Bandar Abbas, a railway station linked to the Shahid Rajaei port, a telecoms tower and a civilian airport in Iranshahr, causing casualties, feeding Iran's IRGC threat to destroy regional infrastructure.Iran has countered with missiles and drones against US bases in neighboring states, including a barrage on an expanded air base in Jordan, and separate strikes reported against Kuwait.Iran also said it targeted US helicopters and reconnaissance aircraft at the Sakhir base in Bahrain in a drone attack, with explosions heard in Doha and a Qatari government alert sent to residents' phones; unconfirmed reports also suggest Iran targeted the King Fahd Causeway linking Bahrain and Saudi Arabia.Iran has told the Houthis to be ready to close the Red Sea oil route if the US strikes Iranian power infrastructure.Oil prices edged higher on Friday after the United States and Iran escalated attacks across the Gulf overnight, with a broken truce continuing to limit flows out of the Strait of Hormuz and Tehran preparing a second potential chokepoint closure via the Red Sea, according to Reuters.Brent crude rose about $1, or roughly 1.25%, to trade near $85 a barrel, while US West Texas Intermediate gained a similar amount, or about 1.3%, to around $80, erasing losses from the previous session. Both benchmarks are now up close to 12% for the week, with Brent on track for a third straight weekly gain and WTI for a second.The US launched two large waves of air strikes on Iran in a single day on Wednesday, the first time it has done so since a memorandum of understanding paused fighting last month, and continued strikes into Thursday. CENTCOM said forces began a new wave of strikes for a sixth consecutive night aimed at further degrading Iranian military capabilities. Those strikes have extended to transport and communications infrastructure, hitting three bridges near Bandar Abbas, including the Bandar Khamir overpass and the Gariveh Bridge, a railway station linking to the Shahid Rajaei port, a telecommunications tower, and a civilian airport in Iranshahr, causing casualties and prompting Iran's Islamic Revolutionary Guard Corps to threaten to destroy infrastructure across the region in response.Iran has retaliated with missiles and drones targeting US military bases in neighboring states, including a barrage against a recently expanded air base in Jordan, along with separate strikes reported against Kuwait. Iran also said it targeted US helicopters and reconnaissance aircraft at the Sakhir base in Bahrain in a drone attack. Explosions were heard in Doha, and Qatar's government sent a cell phone alert to residents, while unconfirmed reports suggested Iran had also targeted the King Fahd Causeway connecting Bahrain and Saudi Arabia.Adding to supply concerns, Iran's leadership has told the Houthi movement to be prepared to close the Red Sea oil export route if the US strikes Iranian power infrastructure. With the conflict now touching Jordan, Bahrain and Kuwait in addition to Iran itself, and both Hormuz and the Red Sea route under direct threat, traders are likely to keep a substantial risk premium priced into crude until there is clearer evidence of de-escalation. This article was written by Eamonn Sheridan at investinglive.com.