OIL prices climbed for a second consecutive session on Friday after fresh security concerns in the Strait of Hormuz clouded prospects for the full reopening of one of the world's most critical oil transit routes.
US West Texas Intermediate (WTI) crude traded above US$78 per barrel, while Brent crude rose beyond US$83 per barrel, following reports that Iran had attacked what it described as "hostile targets" in the Strait of Hormuz after explosions were reported near Qeshm Island.
The renewed hostilities have heightened concerns over potential disruptions to global energy supplies through the strategic waterway, which carries about one-fifth of the world's oil shipments.
Markets were also assessing the implications of a proposed Iran-Oman agreement governing navigation through the Strait of Hormuz.
Under the draft proposal, Iran is seeking to prohibit US and Israeli vessels from transiting the waterway and require countries it considers hostile to pay compensation before passage is permitted.
Tehran has also proposed imposing penalties equivalent to 20 per cent of a vessel's cargo value for violations and maintains that the Strait of Hormuz will only be fully reopened once the United States lifts its maritime blockade.
The proposal, currently under review by Iran's parliament, outlines significantly tougher conditions for commercial shipping than markets had anticipated, reinforcing concerns over future oil exports from the Gulf.
Meanwhile, the US Dollar Index edged up to 99.8 on Thursday but remained close to a seven-week low as investors balanced geopolitical developments with expectations ahead of the closely watched US nonfarm payrolls report.
Reports that Iran and Oman had reached an understanding on a proposed shipping arrangement through the Strait of Hormuz provided some optimism that energy flows could eventually resume, although uncertainty remains over a broader agreement between Washington and Tehran.
US President Donald Trump said negotiations with Iran were continuing, adding that he would "see what happens."
Attention is now firmly on the release of the US nonfarm payrolls report, which is expected to offer fresh insight into the strength of the labour market and the Federal Reserve's monetary policy outlook.
A stronger-than-expected employment report would likely reinforce expectations that interest rates will remain elevated for longer, while weaker data could temper expectations of further policy tightening and ease upward pressure on US Treasury yields. - August 7, 2026
