Oil Prices Hit Two-Week High Following Drone Strike on UAE Nuclear Facility

On Monday, oil prices continued to rise as hopes for ending the U.S.-Israel conflict with Iran weakened. Markets also reacted after an attack on a UAE nuclear facility, while President Donald Trump is likely to review military plans related to Iran.

Brent crude futures LCOc1 climbed $1.44, or 1.32%, to $110.70 a barrel by 2337 GMT after touching the highest since May 5 earlier in the session.

U.S. West Texas Intermediate CLc1 was at $107.26 a barrel, up $1.84, or 1.75%, following a rise to its highest level since May 4.

Both contracts gained more than 7% last week as hopes of a peace deal that would end ship attacks and seizures around the Strait of Hormuz dimmed. Last week’s talks between Trump and Chinese President Xi Jinping ended without an indication from the world’s top oil importer that it would help resolve the conflict.

Drone attacks on the UAE and Saudi Arabia and rhetoric from the U.S. and Iran raised concerns of an escalation in the conflict.

Emirati officials said they were investigating the source of the strike on the Barakah nuclear power plant and that the UAE had the full right to respond to such “terrorist attacks.”

Saudi Arabia, which intercepted three drones that entered from Iraqi airspace, warned it would take the necessary operational measures to respond to any attempt to violate its sovereignty and security.

“These drone strikes are a pointed warning – renewed U.S. or Israeli strikes on Iran could trigger more proxy attacks on Gulf energy and critical infrastructure by Iran or its regional proxies,” IG market analyst Tony Sycamore said.

Trump is expected to meet top national security advisers on Tuesday to discuss options for military action regarding Iran, Axios reported.

(Inputs from Reuters)

Also Read: China Stops Taiwan From Joining Global Health Forums Despite Support From US And EU