German yields set for fourth straight weekly rise, natural gas prices in focus

Investors watched natural gas and oil prices which headed for a weekly gain, as renewed U.S.-Iran hostilities heightened concerns over Middle East supply risks.

Analysts said that markets are becoming more sensitive to European gas than to crude alone as the euro zone has been shifting away from Russia-Ukraine and Middle East supply and favoured Norway and U.S. alternatives. They also flagged the lower-than-average gas storage levels.

Gas prices eased on Friday morning but remain near their highest levels since January 2023 as the market continues to assess how Europe's low storage situation and competition for liquefied natural gas (LNG) will shape prices this winter.

Meanwhile, Iranian sources said a U.S. campaign to throttle Iran's economy by blockading its oil exports and stopping sanctions evasion is growing increasingly difficult to withstand.