Investing.com - Oil prices climbed on Monday after Saudi Arabia said two of its oil tankers were attacked on Sunday near the entry to the Persian Gulf, adding to tensions in the region as the U.S. cracks down on Iranian oil exports.
U.S. crude prices climbed 1.6% to trade at $62.6 by 08:48 AM ET (12:48 GMT), up $1.00 from their previous settlement.
London traded Brent crude futures were up 1.8% to $71.92, an increase of $1.84 from their last close.
Saudi Arabia’s state run press agency said there was “significant damage” to the two tankers, as a result of “a sabotage attack” and hinted strongly that the kingdom suspects Iran of being behind them.
The attacks come a week after the U.S. dispatched a carrier task force to the Gulf to help impose a crackdown on Iranian oil exports. Saudi Arabia has angered Iran by offering to make good any shortfall in supplies to the Islamic Republic’s traditional clients.
The escalation in Middle East tensions posed a threat to global oil supply.
Fears of conflict in the Gulf have outweighed the otherwise negative effect on sentiment from the worsening U.S.-China trade dispute. China announced plans to hike tariffs on around $60 billion of U.S. imports on Monday, responding to new U.S. tariffs on $200 billion of Chinese goods, which came into effect on Friday morning and the threat of further tariffs on goods as yet untouched by the dispute.
The United States and China together accounted for 34% of global oil consumption in the first quarter of 2019, data from the International Energy Agency showed.
Separately, U.S. energy companies last week reduced the number of oil rigs operating for the third time in four weeks, apparently easing up on plans for future output given the renewed threat to the global demand outlook.
Drillers cut two oil rigs in the week to May 10, bringing the total count down to 805, Baker Hughes energy services firm said in its closely followed report on Friday.
The rig count has declined over the past five months as independent exploration and production companies cut spending on new drilling.
Elsewhere, U.S. gasoline futures also rose to their highest in 10 days, touching $2.0395, their highest in 10 days, before pulling back to $2.0379, up 2.5% on the day.
--Reuters contributed to this report