Brent Crude prices soared by 3% early on Tuesday to above $86 per barrel, following an Iranian attack on two tankers of the United Arab Emirates in the southern lane of the Strait of Hormuz, in one of the biggest attacks in the recent re-escalation in the region.
In early trading in Europe today, Brent Crude prices jumped by over 3% to above $86 per barrel, and were trading at $86.06 a barrel at 9:00 a.m. London time.
The U.S. benchmark, WTI Crude, was surging by 3.1% to top $80 per barrel for the first time in a month. The front-month WTI Crude futures traded at $80.58 as of 9:00 a.m. London time, up by 3.12% on the day.
The latest flare-up in tensions in the Middle East reignited a crude rally, with prices jumping by 12% between Friday and early Tuesday.
The news of the fresh attack on UAE tankers in the Strait of Hormuz added further fuel to the oil price rally as the market realized safe passage through the chokepoint, even through the southern lane close to Oman, isn’t safe at all.
“The national tankers Mombasa and Al Bahiyah were targeted by two Iranian cruise missiles while transiting the southern shipping lane of the Strait of Hormuz, within Omani territorial waters,” the UAE’s Ministry of Defense said.
The attack resulted in the death of one Indian crew member aboard the Mombasa tanker and the injury of eight others, including four who sustained serious injuries, the UAE said, condemning “this blatant attack, which is considered a serious violation and a clear breach of international law that threatens the security and stability of the region.”
“The UAE reserves its full right to respond to this escalation,” the defense ministry added.
Early on Tuesday, ADNOC Logistics and Services confirmed the attacks took place in the early hours of Tuesday, July 14, and condemned them.
Al Bahyah, an ADNOC L&S-owned Very Large Crude Carrier (VLCC), and Mombasa B, a VLCC operated by ADNOC L&S under a time-charter arrangement, sustained significant damage in the attacks, the Abu Dhabi national oil company said.
By Charles Kennedy for Oilprice.com
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