CRUDE oil prices advanced on Friday as escalating tensions between the United States and Iran heightened fears of further disruptions to global energy supplies, putting benchmark prices on track for their strongest monthly performance in years.
Brent crude traded near US$89 a barrel and was poised for an almost 25% monthly gain, while West Texas Intermediate (WTI) hovered around US$84 a barrel, marking a monthly increase of more than 20%.
The rally was driven by renewed military confrontation between Washington and Tehran, after US forces carried out fresh strikes on Iranian targets following attacks on American assets across the region. The escalation has reduced expectations of an immediate diplomatic breakthrough and increased concerns over the security of key energy routes.
However, crude flows through the Strait of Hormuz showed signs of recovery after a recent slowdown, allowing millions of barrels of oil to continue moving through one of the world’s most important shipping channels.
In the Red Sea, Saudi Arabia held discussions with representatives from 43 countries over the formation of a maritime coalition aimed at protecting shipping routes after Iran-backed Houthi militants imposed a blockade last week.
Traders also remained cautious over potential supply disruptions in the Black Sea after operations at an export terminal vital to Kazakhstan’s crude shipments were suspended again following fresh attacks on oil tankers.
Meanwhile, the US dollar weakened sharply during Thursday’s American trading session after economic data showed slower-than-expected growth and a moderation in underlying inflation pressures.
The US Dollar Index (DXY) fell about 0.8% to trade near the 100.00 mark after preliminary figures showed the US economy expanded at an annualised rate of 1.5% in the second quarter, below the 2.1% market forecast.
Core Personal Consumption Expenditures (PCE) inflation rose 0.1% month-on-month in June, below expectations of 0.2%, while the annual rate eased to 3.3% from 3.4%.
Despite signs of cooling inflation, some indicators pointed to persistent price pressures, with the GDP Price Index surging 6.3%, well above the 3.6% forecast. Initial jobless claims also remained stable at 197,000, below expectations of 200,000.
The euro strengthened against the dollar, with EUR/USD rising about 0.5% to around 1.1530 after eurozone economic growth exceeded expectations. The region’s economy expanded 0.4% quarter-on-quarter in the second quarter, double the forecast of 0.2%, while annual growth accelerated to 1.0%.
Sterling also gained, with GBP/USD advancing around 0.8% to 1.3470 after the Bank of England kept its benchmark interest rate unchanged at 3.75%, although three policymakers voted in favour of a rate increase, signalling continued concerns over inflation.
The Japanese yen recorded the strongest movement among major currencies, with USD/JPY falling around 2.4% to near 159.50 amid speculation that Japanese authorities may have intervened to support the currency.
The Australian dollar climbed approximately 1.1% against the greenback to above 0.7030, benefiting from broad US dollar weakness and stronger demand for risk-sensitive currencies.
In precious metals markets, gold rose around 1.1% to trade near US$4,113 an ounce, supported by a weaker US dollar and softer inflation readings, while silver outperformed with gains of nearly 3% to approach US$59.20 an ounce. - July 31, 2026
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