Oil prices rise after suspected attack on two tankers in Gulf of Oman

13 June 2019 (Last Updated June 13th, 2019 12:38)

Oil prices have increased as much as 4% following a suspected attack on two tankers in the Gulf of Oman near Iran and the Strait of Hormuz.

Oil prices have increased as much as 4% following a suspected attack on two tankers in the Gulf of Oman near Iran and the Strait of Hormuz.

Brent crude futures edged up $1.71 at $61.68 a barrel, while US West Texas Intermediate crude futures rose $1.25 at $52.39 a barrel, Reuters reported.

According to shipping sources, the Marshall Islands-flagged Front Altair tanker carrying a cargo of petrochemical feedstock and the Panama-flagged Kokuka Courageous carrying methanol have been evacuated and the crews were safe.

Front Altair charterer said that the vessel was “suspected of being hit by a torpedo” and Kokuka Courageous manager said it had been damaged due to “suspected attack” but that its cargo was intact.

The latest incident comes after nearby sabotage attacks on vessels off the Fujairah emirate in May 2019.

WisdomTree research director Nitesh Shah told Reuters: “This could be the catalyst that takes oil out of the bear market that it has been in (in) recent weeks.

“Markets have been focused on rising US inventories and threat to demand from trade wars and ignoring supply threats.”

The Bahrain-based US Navy Fifth Fleet is providing assistance to the tankers following the attacks, while the UK Maritime Trade Operations is investigating the cause of the incident. The Islamic Republic News Agency reported that search and rescue teams in Iran have picked up 44 sailors from two tankers that were damaged in the Gulf of Oman.

Oil prices are further gaining support on signs that OPEC members were close to agreeing on continued production cuts.