Oil prices shot up by nearly 20% Monday following the bombing of two massive Saudi energy plants on Saturday, with analysts warning that fuel prices around the world will likely climb in the coming days.
Brent crude futures soared by 19.5% as trading opened in New York on Sunday evening, with a session high of $71.95 (£57.58) a barrel - the highest level since May and the biggest jump in 28 years.
It then settled to a 13% jump at $68.06 (£54.6) per barrel, a day after an attack on the Abqaiq facility in Saudi Arabia and the Khurais oil field, operated by the state-owned Saudi Aramco, wiped out 6% of the world’s oil supply.
A fleet of drones made at least 19 hits on the facilities, according to US military reports, reducing Saudi Arabia’s daily output to 5.7 million barrels a day, or half of what it should be.
A Saudi official told the Wall Street Journal a third of output could be restored on Monday, but admitted that repairing the damage would take several weeks.
US President Donald Trump has said oil from the US's emergency fuel storage of 640 million barrels, held in Louisiana and Texas, will be released if needed, while Saudi officials have said they will try to plug the shortfall with their own reserves.
The bombing has heightened tensions in the region, with the US claiming Iran was responsible for the assault, an accusation Tehran dies, while Iran-backed Houthi rebels from Yemen have claimed responsibility.
Trump said the US had fresh evidence to back up Secretary of State Mike Pompeo's allegation that Iran was responsible, while US military officials have said the nature of the explosions were consistent with coming from Iran or Iraq, rather than Yemen to the south.
A commander in Iran’s paramilitary Revolutionary Guard warned its forces could strike US military bases across the Middle East with their ballistic missiles after Trump said the US was “locked and loaded” and ready to respond with force.
Iranian Brigadier General Amir Ali Hajizadeh said: "Because of the tension and sensitive situation, our region is like a powder keg.
These latest attacks add to a number of incidents which have inflamed tensions over the past months.
Several oil tankers have been hit, with America blaming Tehran, and Iran also shot down a US military surveillance drone.