U.S. Strikes Iranian Tankers as Peace Talks Hang in the Balance

U.S. forces fired on and disabled two Iranian oil tankers on Friday after exchanging fire with Iranian forces in the Strait of Hormuz overnight , according to NPR. The statement named the "unladen oil tankers" as the M/T Sea Star III and M/T Sevda , CBS News reported. In its statement, CENTCOM said a U.S. fighter jet disabled another Iranian-flagged oil tanker, M/T Hasna, trying to sail into an Iranian port Wednesday, firing several rounds into its rudder .

The strikes came even as diplomatic efforts appeared to be gaining momentum. The one-page, 14-point memorandum of understanding (MOU) is being negotiated between Trump's envoys Steve Witkoff and Jared Kushner and several Iranian officials, both directly and through mediators. In its current form, the MOU would declare an end to the war in the region and the start of a 30-day period of negotiations on a detailed agreement to open the strait, limit Iran's nuclear program and lift U.S. sanctions , Axios reported.

Iran is expected to hand over its response to mediators about the US proposal to end the war on Thursday, a regional source told CNN . But tensions remain high. An adviser to Iran's supreme leader on Friday compared control over the Strait of Hormuz to having an "atomic bomb," and vowed not to relinquish it. Adviser Mohammad Mokhber said Iran had long "neglected" its privileged position along the strait, a vital conduit for oil and gas shipments that Tehran shut early in the Middle East war, throwing markets into turmoil and stranding hundreds of vessels. "The Strait of Hormuz represents an opportunity as precious as an atomic bomb," he said in a video published by the Mehr news agency .

Oil Spill Detected Near Iran's Main Export Hub

An oil spill has been detected off Iran's Kharg Island in the Gulf and is moving southeastward, London-headquartered maritime risk intelligence firm Windward said on Friday , according to Xinhua. The likely spill — appearing on images as a grey and white slick — covered waters to the west of the 8-kilometer (5-mile) long island, pictures from Copernicus's Sentinel-1, Sentinel-2 and Sentinel-3 satellites showed on May 6-8. "The slick appears visually consistent with oil," said Leon Moreland, researcher at the Conflict and Environment Observatory, who estimated that it was covering an area of approximately 45 square km , Arab News reported.

Kharg Island, where US forces said they had destroyed military targets earlier in the war, is the hub for 90 percent of Iran's oil exports, much of which is bound for China . Satellite images reviewed by The Associated Press show what appears to be an oil slick in the Persian Gulf emanating from the western side of Kharg Island, Iran's main crude export terminal. Images taken Friday show the slick covering about 71 square kilometers (27 square miles) and appear to show oil still leaking from the terminal, said Ami Daniel, CEO of maritime intelligence firm Windward AI .

China's Energy Imports Plunge Amid Hormuz Crisis

The conflict's impact on global energy flows is becoming clearer. Despite Beijing's "worst-case-scenario" planning, when Iran blocked traffic across the Strait of Hormuz in early March, China's exposure was large. Some 38% of oil and 23% of liquified natural gas typically passing through the strait are bound for Chinese ports, according to financial firm Nomura. Overall, that accounts for about half of China's supply of imported oil and a sixth of its natural gas , CNN reported.

Major oil and gas producer Russia, meanwhile, has seen a windfall from the Iran war as Middle East energy supplies have been impacted, prompting major buyers India and China to significantly increase imports, massively boosting Russia's fossil fuel export revenues. In the first quarter of 2026, 90% of Russia's total exports of crude were delivered to China and India, data shows , according to CNBC.

The 2026 Iran war caused immediate volatility in energy markets, with Brent crude oil prices surging 10–13% to around $80–82 per barrel by 2 March 2026. The conflict has caused the restriction of nearly all traffic through the Strait of Hormuz, leading to what the International Energy Agency has characterised as the "largest supply disruption in the history of the global oil market". The head of the IEA described the situation caused by the war as the "greatest global energy security challenge in history" .

Cenovus Warns Canadian Oil Sands Growth "Drying Up"

While global oil prices have surged, Canada's oil sands industry is sounding alarms about its own future. Cenovus Energy (TSX, NYSE: CVE) just posted one of its strongest quarters on record. Its CEO used the earnings call to deliver one of the starkest warnings the oil sands industry has heard in years. Jon McKenzie told analysts on Wednesday that Canada's national conversation around oil sands development has become "myopically focused on the climate agenda" — and that the consequences are already playing out in the investment numbers , OilPrice.com reported.

Only one new greenfield oil sands project has been approved and built in Canada since 2013, even as global demand for oil has continued to grow. What growth Cenovus and its peers have managed has come through acquisitions and wringing more out of existing assets — not by breaking new ground . McKenzie made his views on that tax clear. "The industrial carbon tax is unique to Canada," he said, adding that it gives companies a stronger incentive to invest abroad. Canada is one of the few oil-producing nations to levy such a charge on its energy industry — one reason, he said, that capital has been steadily migrating toward the U.S. and parts of the Middle East, where approval processes are shorter and operating costs are lower .

Natural Gas Markets Navigate Shoulder Season Weakness

In U.S. natural gas markets, US natural gas futures climbed toward $2.78 per MMBtu after the Energy Information Administration reported a smaller than expected storage build. Utilities injected 63 billion cubic feet of gas into storage in the week ended May 1, below forecasts of 74 bcf and lower than both last year's 104 bcf increase and the five year average of 77 bcf. Production in the Lower 48 states is also trending lower, with output expected to fall to a one week low as weak spot prices have prompted producers including EQT Corporation to scale back supply while waiting for stronger prices , according to Trading Economics.

Regional price disparities remain extreme. Changes in spot natural gas prices for Saturday-Monday delivery were mostly modest outside of West Texas, where prices plunged amid strong production, weaker LNG demand tied to maintenance and soft shoulder season weather , Natural Gas Intel reported. According to market data, Henry Hub Natural Gas traded at $3.25/MMBtu on Friday, down 2.4%.

The Permian Basin continues to struggle with pipeline constraints. Forward pricing at the Waha hub has continued to decline, extending the weakness that has persisted across West Texas gas markets since the start of 2026. Waha fixed price has fallen to -$5.69/MMBtu for the prompt month, June, as of May 1. Waha basis also moved lower over the past week, settling Friday at -$8.25/MMBtu , according to AEGIS Hedging.

The standoff in the Strait of Hormuz shows no signs of immediate resolution, even as diplomats work behind the scenes. The chairman of the Joint Chiefs of Staff, Gen. Dan Caine, said Tuesday that 22,500 mariners were trapped in the strait on more than 1,550 commercial vessels , NBC News reported. According to market data, WTI Crude traded at $71.50/bbl on Friday, up 0.6%, while Brent Crude stood at $75.20/bbl, up 0.5%.