Oil spikes on Iranian tanker blasts

LONDON (AFP) - Oil surged yesterday after an Iranian tanker was hit by suspected missile strikes off the coast of Saudi Arabia, sparking fresh conflict fears one month after attacks on Saudi oil facilities that were blamed by Washington on Tehran.

The National Iranian Tanker Company, which owns the ship, revealed that the hull of the Sabiti was hit by two separate explosions off the Saudi coast, saying they were “probably caused by missile strikes”.

Brent and New York crude contracts were catapulted more than two percent higher as the news flashed across traders’ screens just after 0600 GMT, ratcheting up geopolitical and supply tensions in the crude-rich tinderbox Gulf region.

“This clearly puts fuel on the Middle East fire,” SEB commodities analyst Bjarne Schieldrop told AFP. “After the attack on Saudi a few weeks ago, it’s not a matter of if we get new comparable events -- but when, and how much.“And here we are. Great strategy by Saudi if they are behind the attack on the oil tanker.

“No one can directly blame them because we do not 100 percent know it was them. Just as with the attack supposedly by Iran/Yemen on Saudi.

“More of the same to come both ways before Iran/Yemen fundamental issue is solved. One cannot assume full Saudi production next year before issues are solved as renewed outages ... will happen again and again.”

The September 14 attacks on Aramco plants in Abqaiq and Khurais - which initially halved the kingdom’s crude output -- had also set the market alight.Washington concluded that the September strikes were launched from Iranian soil and that cruise missiles were used, but Tehran denies involvement. The attacks were claimed by Yemen’s Huthi rebels.

Friday’s blasts could escalate quickly and spell more global economic turmoil, according to Nordea Markets analyst Thina 
Margrethe Saltvedt.

“The risk premium is rising following the attack on the Iranian oil tanker, not because the tanker per se contains enough oil to squeeze the market, but the risk that this incident will be retaliated or more attacks would come either in Iran, Saudi Arabia or Iraq,” Saltvedt told AFP.