Global oil prices surged by nearly 20% following the bombing of two massive Saudi energy plants.
Analysts have warned motorists are likely to feel the effects in coming days as pump prices are set to rise, with Californian motorists to be hit the hardest as the state relies on Saudi oil imports more than any other.
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.
Drones bombed the Abqaiq facility in Saudi Arabia and the Khurais oil field, operated by the state-owned Saudi Aramco, in the early hours of Saturday, according to the kingdom’s interior ministry.
The plants produce nearly 6% of the world’s oil, and half of Saudi’s oil, with the attack cutting output by 5.7 million barrels a day.
Saudi Arabia has promised to fill in the production gap with its reserves, but Aramco said the damage could take weeks to repair.
A Saudi official told the Wall Street Journal a third of output could be restored on Monday.
Dominic Raab, the foreign secretary, told Sky News: “The attack the installations was a wanton violation of international law.
“It’s despicable and we stand firmly in support of our Saudi partners and other international players who are outraged.
“The picture is not entirely clear, we are working it up and before I talk about who is responsible and the implications I want to have a very clear picture, which we will be getting shortly.”
On Sunday US President Donald Trump said oil from the US’s emergency fuel storage of 640 million barrels, held in Louisiana and Texas, will be released if needed.
The bombing has heightened tensions in the region, with the US claiming Iran was responsible for the assault which was almost immediately claimed by Iran-backed Houthi rebels from Yemen.
Mr Trump said the US had fresh evidence to back up Secretary of State Mike Pompeo’s allegation made the day before that Iran was responsible.
Mr Trump tweeted the US is “locked and loaded” – depending on verification – and he is waiting to hear from the Saudis about who they believe attacked the plants.
He added he is not willing “to meet with Iran”.
Questioned by Sky News on whether the UK would provide military support, Mr Raab said: “You’re getting ahead of yourself, we need to get the full facts.
“I was speaking to US Secretary of State Mike Pompeo yesterday and I will speak to other international partners today. But I won’t pre-judge until I have the full facts.”
Senior US officials said satellite imagery and other intelligence showed the strike was inconsistent with one launched from Yemen, where the Houthis are based.
Photos showed what officials said were at least 19 points of impact at the two Saudi oil plants which were consistent with coming from Iran or Iraq, rather than Yemen to the south.
They also said more devices were recovered from northwest of the facilities after not reaching their targets.
Iran responded by saying the US claims are “maximum lies”, while a commander in its paramilitary Revolutionary Guard warned its forces could strike US military bases across the Middle East with their ballistic missiles.
Iranian Brigadier General Amir Ali Hajizadeh said: “Because of the tension and sensitive situation, our region is like a powder keg.
“When these contacts come too close, when forces come into contact with one another, it is possible a conflict happens because of a misunderstanding.”
He told Iranian media Revolutionary Guard forces were ready for a counterattack if America responded.
The incursion adds to a number of incidents which have inflamed tensions over the past months.
Several oil tankers have been hit, with America blaming Tehran, and there has been at least one suspected Israeli strike on Shiite forces in Iraq.
Iran also shot down a US military surveillance drone.