U.S. factory production posted its largest increase in 14 months in April, driven by motor vehicles and demand for technology goods amid an artificial intelligence spending boom, but supply disruptions from the war with Iran cast a shadow over the manufacturing sector. Those constraints were flagged by a survey from the New York Federal Reserve on Friday showing delivery performance by suppliers in New York state deteriorated in May. The U.S.-Israeli conflict with Iran has disrupted shipping in the Strait of Hormuz, raising energy prices, as well as straining global supply chains and causing shortages of a wide range of goods, including fertilizers, aluminum and consumer products. Producer prices increased at their fastest pace in four years in April. Oil prices jumped on Friday after comments from President Donald Trump and Iran's foreign minister dented hopes of a deal to end ship attacks and seizures around the Strait. "Overall, firmer demand and continued expansion in output point to some resilience in the manufacturing sector," said Michael Gapen, chief economist at Morgan Stanley. "However, uncertainty around supply and prices leaves risks to the near-term outlook tilted to the downside."