Tankers targeted near Strait of Hormuz amid Iran-US tensions

DUBAI, United Arab Emirates — Two oil tankers near the strategic Strait of Hormuz came under a suspected attack Thursday, setting one of them ablaze in the latest mysterious assault targeting vessels in a region crucial to global energy supplies amid heightened tension between Iran and the U.S.

The U.S. Navy, which rushed in to assist the stricken vessels in the Gulf of Oman off the coast of Iran, and the ship's operators offered no immediate explanation on what weapons caused the damage or who used them against the MT Front Altair and the Kokuka Courageous. Each was loaded with petroleum products, and the Front Altair burned for hours, a fire that charred half of one of the vessel's sides and sent up a column of thick, black smoke.

Last month, the U.S. alleged that Iran used limpet mines to attack four oil tankers off the nearby Emirati port of Fujairah. Iran denied being involved then and its foreign minister called the timing of Thursday's incidents suspicious, given that Japanese Prime Minister Shinzo Abe was meeting Supreme Leader Ayatollah Ali Khamenei in Tehran.

Iran previously used mines against oil tankers in 1987 and 1988 in the "Tanker War," which saw the U.S. Navy escort ships through the region. Regardless of who is responsible, the price of a barrel of benchmark Brent crude spiked as much as 4% immediately after the attack, showing how critical the region remains to the global economy.

"The shipping industry views this as an escalation of the situation, and we are just about as close to a conflict without there being an actual armed conflict, so the tensions are very high," said Jakob P. Larsen, head of maritime security for BIMCO, the largest international association representing ship owners.

The suspected attacks happened at dawn Thursday some 40 kilometers (25 miles) off the southern coast of Iran. The Norwegian-owned Front Altair, loaded with naptha from the United Arab Emirates, radioed for help as it caught fire. A short time later, the Japanese-owned Kokuka Courageous, loaded with methanol from Saudi Arabia and Qatar, also called for help.

The U.S. Navy sent a destroyer, the USS Bainbridge, to assist, said Cmdr. Joshua Frey, a 5th Fleet spokesman. He described the ships as being hit in a "reported attack," without elaborating.

U.S. President Donald Trump "has been briefed on the attack," said White House press secretary Sarah Sanders. "The U.S. government is providing assistance and will continue to assess the situation."

Frontline, the firm that operates the Front Altair, told The Associated Press that an explosion was the cause of the fire. Its crew of 23 — from Russia, the Philippiines and Georgia — was safely evacuated to the nearby Hyundai Dubai vessel, it said.

BSM Ship Management said the Kokuka Courageous sustained hull damage and 21 sailors had been evacuated, with one suffering minor injuries.

Iranian state television said 44 sailors from the two tankers were transferred to an Iranian port in the southern province of Hormozgan. The Japanese owners of the Kokuka Courageous said, however, that its 21 Filipino sailors were aboard a U.S. warship. The discrepancy could not be immediately reconciled.

The Front Altair had been bound for Taiwan, the Kokuka Courageous for Singapore, according to the to the data firm Refinitiv.

The fact that both vessels remained afloat suggested mines may have damaged them, Larsen said.

"Judging from the damage, it doesn't look like a torpedo, it looks like something smaller, whether that is a vessel-borne improvised explosive device or even a limpet mine," he told the AP.

Like in Fujairah, dozens of ships ranging from massive oil tankers to smaller pleasure boats, traditional dhows and cargo vessels ply the waters of the strait and the Gulf of Oman. The navies of Iran, Oman, the UAE and the U.S. regularly patrol, but the waters are vast and lit only by the moonlight at night, allowing small vessels to approach without warning.

Tensions have escalated in the Mideast as Iran appears poised to break the 2015 nuclear deal with world powers, an accord that the Trump administration repudiated last year. The deal saw Tehran agree to limit its enrichment of uranium in exchange for the lifting of crippling sanctions. Now, Iran is threatening to resume enriching uranium closer to weapons-grade levels if European nations don't offer it new terms to the deal by July 7.

Already, Iran says it quadrupled its production of low-enriched uranium. Meanwhile, U.S. sanctions have cut off opportunities for Iran to trade its excess uranium and heavy water abroad, putting Tehran on course to violate terms of the nuclear deal regardless.

Thursday's incidents came as Abe's high-stakes diplomatic mission was underway in Iran. Japan's Trade Ministry said the two vessels had "Japan-related cargo," without elaborating.

After talks Wednesday with Iranian President Hassan Rouhani, Abe said any "accidental conflict" that could be sparked amid heightened between Washington and Tehran must be avoided.

His message came hours after Yemen's Iranian-backed Houthi rebels attacked a Saudi airport, striking its arrivals hall before dawn and wounding 26 people. A Saudi-led coalition has been fighting for over four years against the Houthis, whom United Nations experts and the West say receive arms from Iran. Tehran denies that.

A statement published by Khamenei's website after Abe's meeting with Khamenei suggested a tense exchange between the two.

"We have no doubt about your good will and seriousness, but ... I don't regard Trump as deserving any exchange of messages," Khamenei reportedly told Abe. Khamenei also said Iran remained opposed to building atomic weapons, but offered a challenge to Trump.

"You should know that if we planned to produce nuclear weapons, America could not do anything," said Khamenei, who has final say on all matters of state in Iran's Shiite theocracy.

Abe later told journalists he stressed with Khamenei that Trump wanted to de-escalate the tensions.

"I frankly told that to Supreme Leader Khamenei as my opinion," Abe said.

Patrick DeHaan, head of petroleum analysis for GasBuddy issued the following statement on these incidents:

"Overnight, attacks on two oil tankers has concerned traders and energy markets. Oil prices have seen an advance of 3-4% so far this morning, but it is highly unlikely at this point to impact gas prices. The scope of the situation is small, the idea of attacks and perhaps further attacks are the concern and why oil prices are up this morning. The amount of oil is a tiny fraction of global daily demand, but the situation raises risk of another situation or attack in the future, and that's propelling energy markets, but even then, there is nothing to suggest another attack is imminent. Stateside, according to social media, motorists are worried the attacks will raise U.S. gas prices- this is not true and highly unlikely. While oil prices are up some $2 per barrel today, they still remain $13 per barrel lower than 2019's high water mark. Gasoline supply has not changed, and today's rise in wholesale gasoline prices will be offset by previous weeks of heavy losses. It is highly unlikely gas prices will react to the situation- most states have room to see prices continue to fall, so today's small rise will simply offset large decreases that are expected to continue. So in short- no, gas prices will not skyrocket from this event."