Iran oil tanker hit by two missiles off Saudi coast: Iranian state media

DUBAI (Reuters) – An Iranian-owned oil tanker was hit by two missiles in the Red Sea off Saudi Arabia’s coast on Friday, Iran’s state television reported, quoting the National Iranian Oil Company (NIOC) which owns the vessel.

The Sabiti, which was set ablaze, suffered heavy damage and had leaked oil after it was struck in the morning about 60 miles (96 km) from the Saudi port of Jeddah, Iranian media reported. State-run IRNA agency said the leak had been brought under control.

The alleged attack is the latest incident involving oil tankers in the Red Sea and Gulf region, and is likely to ratchet up tensions between regional foes Iran and Saudi Arabia.

The Red Sea is a major global shipping route for oil and other trade, linking the Indian Ocean with the Mediterranean via the Suez Canal. Crude prices jumped on the news and industry sources said it could drive up already high shipping costs.

There was no immediate claim of responsibility. Saudi Arabia had no immediate comment.

The U.S. Navy’s Fifth Fleet, which operates in the region, said it was aware of media reports about the tanker, but did not have any further information.

NIOC named the ship as the Sabiti, a Suezmax vessel, after initial reports said it was the Sinopa. Refinitiv ship tracking data showed the Sabiti in the Red Sea and heading south under its own power, bound for Larak, off Iran’s southern Gulf coast.

Tensions with the United States have been running high since Washington withdrew from a deal between world powers and Iran that aimed to rein in Tehran’s nuclear ambitions. U.S. sanctions have slashed Iranian oil exports, on which Tehran relies.

China, the top buyer of Iranian oil, said it hoped all parties would work to uphold peace and stability in the region.

PRICE JUMP

Iran’s ISNA news agency cited a source saying the Iranian tanker was struck in a “terrorist” attack. Iran’s state television reported that two of the ship’s tanks were damaged.

Iran’s Nour news agency, which is close to the Iranian Revolutionary Guard Corps, said the ship’s crew was safe.

The incident follows strikes on key Saudi oil installations in September and attacks on tankers in the Gulf area in May and June. The United States has blamed Iran, which denied any role.

Oil prices climbed 2% after reports of the tanker explosion, with benchmark Brent and U.S. West Texas Intermediate crude futures both rising more than $1 a barrel. [O/R]

The Sept. 14 attacks on Saudi oil sites in the east of the kingdom shut down 5.7 million barrels per day (bpd) of production, about half of Saudi output and roughly 5% of global supply. Output has since been restored.

Yemen’s Iran-aligned Houthi group claimed responsibility for those attacks, but a U.S. official said they originated from southwestern Iran. Riyadh blamed Tehran. Iran denied any role.

Industry sources said Friday’s incident off the Saudi coast could drive up shipping costs, which have already surged.

“War risk insurance premiums for the Red Sea will now likely go up significantly, as will likely the freight (rates),” said Ashok Sharma, managing director of shipbroker BRS Baxi in Singapore.

Tanker rates have soared to multi-year highs in recent weeks after U.S. sanctions on units of Chinese shipping giant COSCO and after the Saudi attacks.

Disruption to shipping through Red Sea would affect oil passing through the Suez Canal or SUMED crude pipeline, which has capacity for 2.34 million bpd and which runs parallel to the canal. It is used by tankers that cannot navigate the waterway.