Mubasher: Oil prices jumped by 2% on Friday after Iranian news outlets reported a state-owned oil carrier exploded in a suspected missile attack in the Red Sea close to Saudi Arabia, which raised the prospect of supply disruptions, according to Reuters.

By 7:32 am GMT, US Nymex crude futures jumped by 1.9% to $54.57 per barrel (pb), having surged by 2.1% before, while global benchmark Brent futures soared by 2.1% to $60.34 pb.

Iranian state TV reported that the National Iranian Oil Company (NIOC) Sabiti oil tanker, which was initially identified as the Sinopa, was hit offshore the Saudi Arabian city of Jeddah in suspected missile strikes.

The vessel endured severe damage, and was leaking oil into the Red Sea, Iran’s Student News Agency (ISNA) reported, citing sources.

“Spare capacity remains fragile and with supply chain vulnerability a worrying concern at virtually every middle east oil field, traders continue to hedge supply risk premium,” AxiTrader Asia Pacific market strategist Stephen Innes was quoted by Reuters.

The report came amid heightened tensions in the Middle East, after drone attacks against Saudi Arabia’s oil processing facilities in mid-September, which already shut down 5.7 million barrels per day (bpd), or more than 5% of global supply.

Before that, the situation in the region was strained after attacks against oil tankers and US drones in the Strait of Hormuz, a key route for shipping crude oil, in May and June.