Oil Holds Firm as Supply Concerns Mount; Asia Turns to US LNG Amid Trump Tariff Tensions

Oil prices steadied on Friday, bolstered by strong US economic data and lingering concerns over tightening global supply. Brent crude rose above $69 per barrel, while West Texas Intermediate (WTI) hovered around $67, reflecting a market that remains tight despite increased OPEC+ output.

Traders are paying premiums for near-term delivery, with both crude and gasoil in backwardation—suggesting short-term supply anxiety. The resilience of the US economy has also buoyed global markets, further supporting crude prices.

Meanwhile, ongoing US-Asia trade negotiations are shifting energy dynamics. In response to steep tariffs under President Trump, Asian nations are ramping up imports of US liquefied natural gas (LNG) to ease tensions. Vietnam signed a major gas import terminal deal with a US firm, while Japan’s JERA committed to 20-year LNG contracts starting in 2030. Similar discussions are underway with South Korea, India, and the Philippines, including potential cooperation on Alaska’s $44 billion LNG project.

But analysts warn these long-term LNG commitments may hinder Asia’s transition to renewable energy. Expensive infrastructure and binding contracts could trap countries in fossil fuel dependence, even as solar and wind energy grow cheaper and more accessible. “You’re more likely to get stuck,” said Indra Overland of the Norwegian Institute of International Affairs.

Pakistan is already experiencing the pitfalls—rising LNG costs pushed consumers toward rooftop solar, causing demand to drop and forcing the country to offload excess gas shipments.

Despite the diplomatic optics, experts note that the current LNG volumes are insufficient to meaningfully reduce the US trade deficit.