Oil prices rose more than 1% on Monday, lifted by growing concern over supply disruptions in the Middle East even as a standoff in the Sino-U.S. trade talks prompted investors to fret about the global economic outlook.
Brent crude futures rose 83 cents to $71.45 a barrel, a 1.2 percent gain, by 10:38 a.m. EDT (1438 GMT). U.S. West Texas Intermediate (WTI) crude futures rose 69 cents to $62.35 a barrel, a 1.1 percent gain.
Saudi Arabia on Monday said two Saudi oil tankers were among vessels attacked off the coast of the United Arab Emirates. It was unclear how the attacks occurred.
“The attack on a couple of Saudi oil tankers off the coast of UAE has forced an additional price spike across the energy complex as the market factors in some additional geopolitical risk,” said Jim Ritterbusch, president of Ritterbusch and Associates, in a note.
The UAE said on Sunday that four commercial vessels were attacked near Fujairah, one of the world’s largest bunkering hubs. The port lies near the Strait of Hormuz, one of the world’s most important oil export waterways.
Iran’s foreign ministry described the incidents as “worrisome and dreadful” and called for an investigation.
Saudi Arabia and the UAE are the largest and third-largest producers respectively in the Organization of the Petroleum Exporting Countries (OPEC).
The U.S. Maritime Administration said in an advisory on Sunday that the incidents off Fujairah, one of the seven emirates that make up the UAE, had not been confirmed and urged caution.
Volumes were strong in early U.S. trading, with more than 540,000 contracts changing hands in U.S. crude futures, not far from the daily average of 594,000 contracts.
The gains in oil stood in contrast to a slump in risk assets like stocks as investors moved into safe havens like Treasury bonds due to the intensifying U.S.-China trade war.
China plans to impose tariffs on $60 billion worth of U.S. goods, the finance ministry said on Monday, after Washington escalated the trade war with a tariff hike on $200 billion of Chinese products.
Oil prices have risen more than 30 percent this year, supported by supply concerns as the United States has imposed sanctions on both Iran and Venezuela.
Washington reimposed sanctions on Iran in November after pulling out of a 2015 nuclear accord between Tehran and world powers last year.
Iran insists on exporting at least 1.5 million barrels per day (bpd) of oil, triple May’s expected levels under U.S. sanctions, as a condition for staying in an international nuclear deal, sources with knowledge of Iran-EU talks said.
