Singapore — Crude oil futures climbed further during mid-morning trade in Asia Friday, following alleged attacks on two oil tankers near the Strait of Hormuz Thursday, while market participants awaited comments ahead of OPEC's bi-annual meeting later this month.
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At 11:00 am Singapore time (0300 GMT), ICE Brent August futures were up 57 cents/b (0.93%) from Thursday's settle to $61.88/b, while the NYMEX July light sweet crude futures contract rose 33 cents/b (0.63%) at $52.61/b.
"A surge in supply concerns drove pricing levels up after reports surfaced on two tanker attacks in the Persian Gulf," Benjamin Lu, investment analyst at Phillip Futures, said.
"Oil prices look poised to trade higher on an intraday basis though lackluster risk appetites will keep bullish gains measured," Lu said.
US Secretary of State Mike Pompeo on Thursday blamed Iran for the attack on the two tankers, as well as attacks a month earlier on pipelines in Saudi Arabia and on ships in waters near Fujairah.
Japanese Minister of Economy, Trade and Industry Hiroshige Seko on Thursday said two tankers with Japanese interests were attacked near the Strait of Hormuz, a critical chokepoint through which 30% of the world's seaborne oil transits.
After an emergency meeting, Seko on Friday said Japan sees no immediate impact on the country's energy supply after the attacks on the tankers.
"We do not see that there will be any issues for Japan's stable energy supply following the latest incidents," Seko said at a press conference in Tokyo.
Meanwhile, the recent report released by OPEC, which was bearish on demand-side fundamentals capped any further upside gains in prices, analysts said.
OPEC on Thursday said it faces a challenging second half of 2019, with demand-dampening trade disputes combining with expected robust non-OPEC supply growth to complicate the producer bloc's oil market rebalancing efforts.
The organization forecast that 2019 oil consumption will rise 1.14 million b/d year on year, a downward revision of 70,000 b/d from last month's report, as "significant downside risks from escalating trade disputes spilling over to global demand growth remain."
"The upcoming OPEC and non-OPEC ministerial meetings will carefully consider these developments, in order to ensure continued market stability," OPEC said in the report.
The OPEC/non-OPEC coalition has yet to even agree on a date for its meeting to decide on the deal's future, with some countries favoring June 25-26 and others July 3-4.
"This latest issue [the attack on the oil tankers] sets the stage for a tense meeting when OPEC members gather in Vienna later this month. The lack of a confirmed date suggests tension bubbling away between Saudi Arabia and Iran," ANZ analysts said in a note Friday.
As of 0300 GMT, the US Dollar Index was up 0.12% at 97.02.
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