Oil prices peaked to a four months high after two attacks on Saudi Arabian facilities on Saturday knocked out more than 5% of global supply.
At the start of trading, Brent crude jumped 19% to $71.95 a barrel, while the other major benchmark, West Texas Intermediate, rose 15% to $63.34.
Prices eased back slightly after US President Donald Trump authorised the release of US reserves.
It could take weeks before the Saudi facilities are fully back on line.
State oil giant Saudi Aramco said the attacks cut output by 5.7 million barrels per day.
The drone attacks on plants in the heartland of Saudi Arabia’s oil industry included hitting the world’s biggest petroleum-processing facility.
US Secretary of State Mike Pompeo said Tehran was behind the attacks. Iran accused the US of “deceit.”
Later Mr Trump said in a tweet the US knew who the culprit was and was “locked and loaded” but waiting to hear from the Saudis about how they wanted to proceed.
Amidst the escalating tensions Saudi Arabia have been secretive about the extent of damage, but confirmed saying there were no casualties. The kingdom is the world’s biggest oil exporter, shipping more than seven million barrels daily.
Saudi Arabia is expected to tap into reserves so that exports can continue as normal this week.
Source : Various