Oil climbs over $1 on tanker attacks; no progress on peace

Oil futures surged past $1 per barrel on Friday, driven by tanker attacks and the absence of progress on a peace deal between the Trump administration and Iran. Brent crude settled at $88.52 per barrel, while US West Texas Intermediate crude closed at $82.40 per barrel. Over the week, Brent rose 5.9%, and WTI increased by 5.4%. Two vessels belonging to Abu Dhabi National Oil Company were targeted while sailing through the Strait of Hormuz on Thursday, a move the United Arab Emirates government denounced as an Iranian attack.

The US administration stated it could sustain a naval blockade of Iran indefinitely and intensify economic pressure on Tehran in response to ongoing ceasefire negotiations. Asia's LNG spot prices jumped last week as optimism waned for a swift reopening of the Strait of Hormuz following the US threat of a permanent naval blockade.

The September LNG price for northeast Asian deliveries averaged $21.30 per million British thermal units, up from $21.10 per mmBtu the previous week. Fundamentally, the supply outlook remains unchanged, with only a few Gulf shipments navigating through, but not enough to make a significant difference. Demand in northeast Asia remains subdued, and US LNG is playing a crucial role in meeting the shortfall.

Analysts noted that European gas market conditions are expected to stay challenging due to LNG terminal upkeep in France and Norway until September.