Oil Ticks Higher as Strait of Hormuz Closure Keeps Markets Wary
WTI crude rose 0.7% Friday as the Strait of Hormuz remained effectively closed amid stalled US-Iran talks, while equities and the dollar held muted ranges.
Oil prices edged higher Friday as geopolitical pressure from the US-Iran standoff kept energy markets on alert, with WTI crude gaining 0.7% to $72.60 and the Strait of Hormuz in what traders are treating as a de facto closure. A US official suggested negotiations between Washington and Tehran could still occur, offering a brief moment of optimism, but the waterway's status remained unchanged and continued to cast a shadow over global supply.
The International Energy Agency reported that global oil supply rose by 4.1 million barrels per day in June as flows through the Hormuz strait partially resumed — yet supply still sat 9.4 million bpd below pre-war levels, underscoring how much damage the disruption has already done to global energy markets. Iran's leverage over the strait appears to be producing real economic pressure, a dynamic that shows no signs of resolving quickly.
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European equity indices finished the session little changed and mixed, while S&P 500 futures slipped 0.1% and Nasdaq futures fell 0.3%, with tech shares pulling back modestly. The US dollar was broadly flat, with EUR/USD holding at 1.1430 and GBP/USD adding just 0.1% to 1.3425. The Japanese yen was the session's standout mover, pushing USD/JPY down 0.3% to around 161.80 after Japan signaled a significant pension portfolio shift.
In fixed income, US 10-year Treasury yields crept up just 0.6 basis points to 4.547%, suggesting bond markets see little urgency heading into the weekend. Gold slipped 0.3% to $4,107 and silver dropped 0.9% to $59.45, while Bitcoin bucked the cautious tone with a 1.7% gain to $64,368. The Bank of Japan, meanwhile, is expected to hold rates steady at its July meeting while maintaining its tightening guidance.
With the week winding down in a relatively subdued fashion, investor attention is already pivoting to the US CPI report for June, due on July 14, which could meaningfully shift interest rate expectations heading into the second half of the year. Continue reading at Forexlive.
