Oil Prices Surge After Suspected Tanker Attack Near Iran

By Reuters
June 13, 2019Businessshare
Oil Prices Surge After Suspected Tanker Attack Near Iran
The sun sets behind an oil pump outside Saint-Fiacre, near Paris, France on March 28, 2019. (Christian Hartmann/Reuters)

LONDON—Oil prices jumped as much as 4 percent on Thursday after a suspected attack on two tankers in the Gulf of Oman near Iran and the Strait of Hormuz, through which a fifth of global oil consumption passes.

The two tankers, the Marshal Islands-flagged Front Altair and the Panama-flagged Kokuka Courageous, have been evacuated and the crews were safe, shipping sources said.

The Front Altair is carrying naphtha and the Kokuka Courageous methanol.

The charterer of the former said the vessel was “suspected of being hit by a torpedo.” The manager of the latter said it had been damaged as a result of a “suspected attack” but that its cargo was still intact.

The incident followed last month’s nearby sabotage attacks on vessels off the Fujairah emirate, one of the world’s largest bunkering hubs.

Tankers in Gulf of Oman
Position of evacuated tankers in Gulf of Oman. (Reuters)

Brent crude futures were up $1.72 at $61.69 a barrel by 7:57 GMT, having risen earlier by as much as 4.45 percent to $62.64.

U.S. West Texas Intermediate crude futures were up $1.32 at $52.46 a barrel. WTI earlier rose as much as 3.85 percent to $53.11.

Both benchmarks are nevertheless headed for a weekly loss.

Oil prices had slumped in the previous session on an unexpected rise in U.S. crude stockpiles and a dimming outlook for global oil demand.

The United Kingdom Maritime Trade Operations, part of the Royal Navy, said on Thursday that it was aware of an incident in the Gulf of Oman, near the Iranian coast.

Port officials take a photo of the damaged tanker Andrea Victory at the Port of Fujairah, United Arab Emirates, on May 13, 2019. (Satish Kumar/File Photo/Reuters)

“U.K. and its partners are currently investigating,” it said.

U.S. National Security Adviser John Bolton said on May 29 that naval mines “almost certainly from Iran” were used to attack the tankers off the United Arab Emirates last month, and warned Tehran against conducting new operations.

Iran, which has distanced itself from the previous attacks, has said it would not be cowed by what it called psychological warfare.

Also supporting oil bulls were signs that OPEC members were close to reaching an agreement on continuing production cuts.

By Shadia Nasralla

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