EMEA crude futures climbed in after-hours trading on Friday as renewed hostilities between the US and Iran stoked concerns over potential disruptions to Middle East energy flows, while growing risks to shipping via the Red Sea added further support to crude markets.
Brent crude futures rose 3.9% to $87.49 per barrel, while Murban crude futures advanced by 4.3% to $81.09/bbl.
Soojin Kim, research analyst at MUFG, said crude prices were on track for their strongest weekly gain since April as escalating military exchanges between the US and Iran intensified concerns over Middle East energy supplies.
The US and Iran intensified retaliatory attacks beyond military installations during a sixth straight day of hostilities, increasing fears of a return to full war with no agreement reached over the Strait of Hormuz.
US Central Command said overnight that it had completed its sixth consecutive night of strikes against Iran, hitting dozens of military targets such as military logistics infrastructure and maritime capabilities.
Centcom said on Friday that the US military destroyed a surveillance tower on Thursday belonging to Iran's Islamic Revolutionary Guard Corps on the country's southeastern coast.
The destruction of the Chah Bahar Shahid Kalantari Port surveillance tower in the port city of Chabahar will degrade the IRGC's "ability to track and target commercial shipping in the Strait of Hormuz," and to attack civilian crews, Centcom said.
The US Army said the strike protects freedom of navigation in regional waters for all vessels, except for vessels attempting to violate the ongoing US blockade of Iranian ports.
Iran, in response, hit US military infrastructure in Bahrain, Jordan, Kuwait, Oman, Qatar and Syria as Tehran steps up its counterstrikes since fighting picked up early last week.
Kuwait reported strikes on a water desalination and electricity plant, with many power-generation units sustaining damage.
Tehran also fired at Syria, apparently for the first time since the outbreak of the conflict, targeting what it described as a US special forces base in Tanf, an operation that was refuted by US Centcom.
Saxo Bank strategies said the exchange of attacks has raised concerns about supplies, with rising energy prices as observable commercial traffic via the Strait slumps.
The heightened conflict comes as the interim peace deal reached last month has collapsed, once again disrupting energy flows through the Hormuz. The latest data from Kpler showed Hormuz traffic continued to weaken with eight confirmed crossings on July 16, the lowest level in three weeks.
Kpler said seven of the eight transits used the Iranian route, highlighting a growing concentration of movements through higher-risk corridors as operators reassess security, crew safety and insurance exposure.
The UKMTO said on Friday that a vessel was boarded by unauthorized personnel while transiting through the Gulf of Aden off the coast of Yemen.
The maritime security agency also reported an attack on a tanker near Khasab, Oman, along with separate harassment incidents in waters near Iran's Kharg Islands and Duqm, Oman.