Tehran: Suspected missile strikes hit an Iranian oil tanker near the Saudi coast on Friday, its owner said, the first Iranian vessel targeted since a spate of attacks in the Gulf Washington blamed on Tehran.
Oil prices surged more than 2% on the news, which raised new supply concerns with tensions still high after last month's attacks on two Saudi crude facilities.
The National Iranian Tanker Company, which owns the ship, said the hull of the Sabiti was hit by two separate explosions off the Saudi coast, saying they were "probably caused by missile strikes".
The news sent Brent surging 2.3% to $60.46, while West Texas Intermediate jumped 2.1% to $54.69. Prices had already been rising on growing hopes for a breakthrough in the China-US trade talks.
The blasts come just weeks after two of Saudi Arabia's biggest oil installations were hit, wiping out 5% of global production.
The National Iranian Tanker Company said the hull of the vessel was hit by two separate explosions about 100 kilometres (60 miles) off the Saudi coast.
It identified the tanker as the Sabiti and said the blasts were "probably caused by missile strikes".
"All the ship's crew are safe and the ship is stable too," NITC said, adding those on board were trying to repair the damage.
Oil was leaking from the tanker into the Red Sea off the major Saudi port of Jeddah.
The state-owned company said that contrary to reports, "there is no fire aboard the ship and the ship is completely stable".
According to Iranian state television, the blasts could have been the result of a "terrorist attack." There was confusion about the name of the vessel involved.
TankerTrackers, a site that monitors maritime traffic, identified the ship as the Sinopa.
It comes after a spate of still unexplained attacks on shipping in and around the vital seaway to the Gulf involving and Western powers.
Washington accused Tehran of attacking the vessels with mines, something it strongly denied.
There have also been seizures of both Iranian and Western-flagged vessels and twin attacks claimed by Yemeni rebels allied with Iran on key Saudi oil infrastructure.
Both Washington and Riyadh blamed Tehran for those attacks, which wiped out five per cent of global production. Iran again denied any role.
The United States has since formed a naval coalition to escort commercial vessels through the strategic Strait of Hormuz. It has been joined by Australia, Bahrain, Britain, Saudi Arabia and the United Arab Emirates.
Friday's incident is the first involving an Iranian ship since the "Happiness 1" broke down at about the same location in early May.
That ship was repaired in Saudi Arabia and held in the kingdom until July 21 when it was released.
The rare docking came despite escalating tensions between staunch enemies Iran and Saudi Arabia.
Saudi Arabia severed diplomatic ties with Iran in 2016, after its missions in the country were attacked in demonstrations over the Sunni-ruled kingdom's execution of prominent Shiite cleric, Nimr al-Nimr.
They still lack direct diplomatic channels, and Iranian foreign ministry spokesman Abbas Mousavi in July thanked "Switzerland and Oman as well as related Saudi parties for offering services and facilities" to resolve the issue.
Iran has been locked in a standoff with the United States and its Gulf Arab allies since US President Donald Trump withdrew from a 2015 deal that gave it relief from sanctions in return for curbs on its nuclear programme.