Oil prices jumped about 5% on Monday as Iran stepped up its attacks on the United Arab Emirates and ships in the Persian Gulf over the past 24 hours.
Brent was up $5.75, or 5.3%, at $113.92 a barrel, while U.S. crude was up $3.54, or 3.5%, at $105.48.
According to Iranian news agencies, the Revolutionary Guards navy has released a map that it claims expands areas under Iranian control near the Straits of Hormuz to include the UAE ports of Fujairah and Khorfaqan, as well as the coastline of the emirate of Umm Al Quwain.
About 20% of the world’s oil and liquefied natural gas (LNG) supply passed through the Strait of Hormuz before the strikes launched by the United States and Israel against Iran on February 28.
Donald Trump said on Sunday that the US would begin helping free ships stuck in the Gulf. On Monday, the US military announced that two Navy guided-missile destroyers entered the Gulf to break the Iranian blockade, while two US merchant ships passed through the Straits.
“The price path remains bullish as long as flows through the Straits remain limited,” said the UBS analyst, Giovanni Staunovo.
Earlier, the United Arab Emirates accused Iran of attacking an empty crude oil tanker belonging to Abu Dhabi’s state-owned company ADNOC with drones as it attempted to pass through the Straits. Meanwhile, the United Kingdom Maritime Trade Operations said it had received a report of an incident involving a cargo ship about 36 nautical miles north of Dubai, while it also spoke of a separate incident earlier in the day near the UAE.
The energy minister of the UAE, which quit OPEC last week, said the country owed it to its investment partners to produce the quantities demanded by international oil markets without restrictions, in cooperation with other producers.
OPEC and its allies, known as OPEC+, said they would raise production targets by 188,000 barrels per day in June for seven members, marking the third consecutive monthly increase.
Reuters
