Oil prices ended nearly 15% higher on Monday, with the Brent benchmark seeing its biggest jump in about 30 years.
The rise came after two attacks on Saudi Arabian facilities on Saturday knocked out about 5% of global supply.
Brent crude initially surged 20% at the start of trading, but eased back to end at $69 a barrel, up 14.6%. US oil prices finished up 14.7%, the biggest jump since 2008.
Prices fell back after President Donald Trump vowed to release US reserves.
The strike, which the US blames on Iran, has sparked fears of increased risk to energy supplies in the region.
However, prices remain below Brent’s 12-month high of $86.29 a barrel seen last October, when West Texas Intermediate also climbed to more than $76 a barrel.
The drone attacks on plants in the heartland of Saudi Arabia’s oil industry hit the world’s biggest petroleum-processing facility as well as a nearby oil field, both of which are operated by energy giant Aramco.
Together they account for about 50% of Saudi Arabia’s oil output, or 5% of daily global oil production. It could take weeks before the facilities are fully back on line.
However, she says that if the outage lasts for more than six weeks, oil prices could hit “north of” $75 a barrel.
Bob McNally, president of Rapidan Energy Group and a former energy adviser in George W. Bush’s administration, told the BBC: “I think it’s going to last. As long as the United States and Saudi Arabia on one hand and Iran on the other remain in this escalatory conflict then we’re going to
build in a risk premium because it’s getting very serious.”
US Secretary of State Mike Pompeo claimed that 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.
