International oil prices rose by more than 3%, and a Kuwaiti oil tanker was attacked in Dubai Port

# Dong Jing

Source: Wall Street CN

On March 31, Kuwait Petroleum Corporation (KPC) confirmed that its oil tanker *Al-Salmi* was attacked by Iran at the port of Dubai, United Arab Emirates. The vessel sustained hull damage and caught fire, with the incident also posing a risk of oil spillage in surrounding waters. Coupled with attacks on Kuwait’s domestic infrastructure, the de facto closure of the Strait of Hormuz, and U.S. President Trump’s threats to strike Iran’s critical facilities, international oil prices surged sharply, with both WTI and Brent crude rising by more than 3%.

Oil prices jumped sharply on Tuesday as Iran attacked a fully loaded Kuwaiti oil tanker, and President Trump threatened to target Iran’s civilian infrastructure. The escalating tensions in the Middle East have plunged energy markets into a new round of turmoil.

On March 31, Kuwait Petroleum Corporation confirmed that its tanker *Al-Salmi* was attacked by Iran at Dubai Port, UAE. The ship was damaged, caught fire, and the incident could cause an oil spill in surrounding waters.

Buoyed by the news, West Texas Intermediate (WTI) crude rose as much as 3.7% to hit $106.70 per barrel, building on its close the previous day at the highest level since July 2022. Brent crude futures also surged more than 3%, on track for a record monthly gain.

Meanwhile, President Trump warned in a social media post on Monday that if Iran does not reopen the Strait of Hormuz, the U.S. will destroy its power plants, oil facilities, and “possibly” even its desalination infrastructure.

Rebecca Babin, senior energy trader at CIBC Private Wealth Group, said: “Every step forward is followed by five steps back. With 10–12 million barrels per day effectively missing from the market, the buffer is fading, and rhetoric alone is becoming less effective in suppressing prices.”

The Strait of Hormuz has effectively been closed to shipping, severely cutting off supplies of crude oil, natural gas, and diesel. Global energy prices have continued to soar, and inflationary pressures have spiked abruptly.

## Tanker Attacked, Oil Spill Risk Near Dubai Port

According to CCTV News, the UK Maritime Trade Operations (UKMTO) issued a notice on March 30 local time stating that an oil tanker was struck on its starboard side by an unidentified object 31 nautical miles northwest of Dubai, UAE, causing a fire on board. The notice confirmed all crew members were safe. In the early hours of March 31 local time, Kuwait Petroleum Corporation confirmed that one of its tankers had been attacked at Dubai Port, UAE.

Kuwait Petroleum Corporation confirmed that the attacked vessel was its *Al-Salmi* tanker, which was fully loaded at the time. The attack caused hull damage, and emergency teams have been mobilized to contain the situation. The incident could result in an oil spill in surrounding waters.

This is the latest in a series of attacks by Iran on vessels in the Gulf region since the outbreak of hostilities. Iran has reportedly struck two ships near Iraq in recent days, and the latest attack near Dubai Port has further pushed the conflict into the core shipping lanes of the Gulf.

## Kuwait’s Domestic Infrastructure Also Targeted

The scope of the attacks has extended beyond maritime targets.

According to Xinhua News Agency, Fatima Al-Hayat, spokesperson for Kuwait’s Ministry of Electricity, Water and Renewable Energy, stated that a power and desalination facility in the country was attacked “from Iran” on the evening of March 29, killing one Indian national and causing severe damage to the building.

Kuwait’s military said on the same day that a military base was hit by multiple missiles, injuring 10 soldiers. Additionally, seven overhead power lines across Kuwait were damaged by falling shrapnel, four of which have been repaired and restored to service. Kuwaiti authorities said technical teams are working around the clock to ensure the continuity of critical services.

## Trump Escalates Threats, U.S.-Iran Talks Stalled

Diplomatically, there are no signs of de-escalation.

President Trump warned in a social media post on Monday that if Iran does not reopen the Strait of Hormuz, the U.S. will target its power plants, oil facilities, and even desalination infrastructure.

U.S. Treasury Secretary Bessent said in an interview with Fox News that the U.S. will “reclaim” control of the Strait of Hormuz and ensure navigation safety through U.S. or multinational escort missions.

Analysts note that despite Trump’s repeated claims that a deal with Iran is “imminent,” the conflict has entered its fifth week with no signs of easing.

Notably, Yemen’s Houthi movement launched missiles at Israel over the weekend, further expanding the conflict’s scope.

Reports indicate Iran is pushing the Houthis to resume attacks on Red Sea shipping, which would threaten alternative routes outside the Strait of Hormuz, including Saudi Arabia’s pipeline that transports crude from its eastern fields to the port of Yanbu on the west coast.

## Supply Gap Widens, Market Buffer Depletes

The de facto closure of the Strait of Hormuz has had a profound impact on global energy supplies.

WTI crude is on track for a nearly 60% monthly gain, its largest since May 2020; Brent crude futures are set for a record monthly increase. U.S. national average gasoline prices are approaching $4 per gallon, a level expected to create significant political pressure on President Trump.

Shaia Hosseinzadeh, Chief Investment Officer at OnyxPoint Global Management, noted: “$100 is a purgatory—high enough to be unsustainable, yet too low to reflect the true disruption in the physical market. Current price signals are not fully capturing the on-the-ground reality.”

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