Two oil tankers damaged in Gulf of Oman; one reports 'suspected attack'

US and UK officials have begun an investigation
Two oil tankers damaged in Gulf of Oman; one reports 'suspected attack'
By Bloomberg
Thu 13 Jun 2019 11:01 AM

The US Fifth Fleet said two oil tankers were damaged in an incident near the Strait of Hormuz that one of the ships’ operators described as a suspected attack. Oil prices surged.

The development will inflame already-rising political tensions in the region weeks after four vessels, including two Saudi oil tankers, were sabotaged in what the US said was an Iranian attack using naval mines. Tehran denied the charge.

The Bahrain-based Fifth Fleet said it received two separate distress signals at 6:12 a.m. and about 7:00 a.m. local time. “US Navy ships are in the area and are rendering assistance,” Commander Josh Frey, a spokesman, said. Iran said it has rescued 44 sailors.

The manager of tanker Kokuka Courageous, which was sailing from Saudi Arabia to Singapore with a cargo of methanol, said the vessel “has been damaged as a result of the suspected attack.”

“The hull has been breached above the water line on the starboard side,” Bernhard Schulte GmbH & Co KG said in a statement on its website. It said the cargo was intact and the ship wasn’t in danger of sinking.

Another tanker, Norwegian-owned Front Altair, sent a distress signal to the UAE port of Fujairah. It had loaded an oil shipment in Abu Dhabi, according to data compiled by Bloomberg.

The prospects of a showdown between the US, its Arab allies on one hand, and Iran on the other, have spiked since the Trump administration stopped granting waivers to buyers of Iranian oil early in May. President Donald Trump withdrew the US last year from a landmark 2015 agreement meant to prevent the Islamic Republic from developing a nuclear weapon.

“Even in the absence of ironclad evidence, the US and its allies will point the finger at Iran,” said Fawaz A. Gerges, professor of Middle Eastern politics at the London School of Economics.

“These incidents are a bad omen because they point to a calculated escalation that tells us sides are hunkering down. That could easily spiral out of control in a cycle of retaliations.”

Saudi Arabia and its allies blame Iran for ordering attacks on targets in the kingdom by Yemen’s Houthi rebels, using increasingly sophisticated weapons. An explosives-laden drone last month hit a Saudi Aramco oil facility hundreds of kilometers away from Yemen’s border, forcing the company to temporarily shut one of its key pipelines.

On Wednesday, a missile launched by the Houthis wounded 26 people when it landed at the arrival section of an airport in the kingdom’s south.

Brent oil crude jumped as much as 4.5 percent and was trading at $61.80 a barrel at 11:51 a.m. in Dubai. Stocks in Saudi Arabia, Dubai and Abu Dhabi were all down more than 1 percent.

The Strait of Hormuz, at the entrance of the Arabian Gulf, is a waterway for about 40 percent of the world’s seaborne oil shipments.

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