Oil prices extend gains on Monday
Oil prices extended gains on Monday as Middle East tensions escalated after a reported attack on the Barakah nuclear power plant in the United Arab Emirates. Investors also monitored expectations that US President Donald Trump could discuss military options on Iran.
Brent crude rose $2.01, or 1.84 per cent, to $111.27 a barrel by 0432 GMT after earlier touching $112, its highest level since May 5. US West Texas Intermediate crude gained $2.33, or 2.21 per cent, to $107.75 a barrel after reaching $108.70, the highest since April 30.
Both benchmarks had climbed more than 7 per cent last week as hopes for a peace deal faded and attacks around the Strait of Hormuz raised concerns over global oil supplies.
Tensions escalated after drone attacks targeted the UAE and Saudi Arabia, while the United States and Iran exchanged increasingly hostile rhetoric. Emirati authorities said they were investigating the strike on the Barakah nuclear plant, while Saudi Arabia said it intercepted three drones entering from Iraqi airspace.
Axios reported that Trump is expected to meet national security advisers on Tuesday to discuss possible military action against Iran.
Analysts said fears of renewed strikes on Iran and the expiration of a US sanctions waiver allowing countries, including India, to purchase Russian seaborne oil added further support to oil prices.
Attribution: Reuters