Oil prices settle lower on hopes for smoother shipping in Strait of Hormuz

Doha, Qatar: Oil prices settled lower on Friday following the latest round of US-Iran hostilities as traders grew hopeful that shipping through the Strait of Hormuz would eventually resume, but prices finished the week with sharp gains.

Brent crude futures settled at $76.01, while US West Texas Intermediate (WTI) crude finished at $71.41.

For the week, Brent rose 5.4%, while WTI gained 4.0%, noted Al-Attiyah Foundation in its Weekly Energy Market Review.

On Thursday, Iranian armed forces launched attacks on US military infrastructure in Gulf states after US strikes on Iran’s southern coastal and eastern provinces.

Iranian media reported multiple explosions across southern Iran.

The affected area included Bushehr, home to one of Iran’s nuclear power plants.

The absence of further overnight US strikes on Iran likely weighed on oil prices, though reduced flows through the Strait of Hormuz continued to limit the downside.

Asia’s spot liquefied natural gas price rose for a third consecutive week to its highest level in a month, as escalating Middle East tensions fuelled further concerns over supplies and shipping through the Strait of Hormuz.

The average LNG price for August delivery into northeast Asia was $18.00 per million British thermal units, up from $16.40 per mmBtu the week before.

A recent escalation in US-Iran tensions has strained an already fragile ceasefire, after projectiles hit three tankers in the Strait of Hormuz.

In Europe, the Dutch TTF gas price settled at $16.31 per mmBtu, posting a weekly gain of 8.3%.

The escalation has raised fresh concerns over reduced LNG supply in August and September.

This would coincide with the Norwegian autumn maintenance season and could prolong market tightness into late summer.

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