UPDATE 2-Saudi Arabia says two Saudi oil tankers attacked near UAE waters

Saudi Arabia said on Monday that two Saudi oil tankers were among vessels targeted by a "sabotage attack" off the coast of the United Arab Emirates, condemning it as an attempt to undermine the security of global crude supplies. The UAE said on Sunday that four commercial vessels were sabotaged near Fujairah emirate, one of the world's largest bunkering hubs lying just outside the Strait of Hormuz. It did not say who was behind the operation, which took place amid heightened tensions between the United States and Iran.

Iran's foreign ministry called the incidents "worrisome and dreadful" and asked for an investigation into the matter. The strait, a vital global oil and gas shipping route, separates the Gulf states and Iran, which has been embroiled in an escalating war of words with the United States over sanctions and the U.S. military's presence in the region.

Oil prices rose on Monday, with Brent crude futures trading at $70.98 a barrel at 0618 GMT. Saudi Energy Minister Khalid al-Falih said in a statement that one of the two Saudi vessels attacked was on its way to be loaded with Saudi crude from Ras Tanura port for delivery to state-owned Saudi Aramco's customers in the United States.

The attack did not lead to any casualties or an oil spill but caused significant damage to the structures of the two vessels, said the statement, carried on state news agency SPA. Trading and shipping sources identified the Saudi vessels as Bahri-owned very large crude carrier (VLCC) tanker Amjad and crude tanker Al Marzoqah. Bahri did not respond to a request for comment.

The UAE foreign ministry said on Sunday there were no casualties and the Fujairah port operations were normal. An investigation had been launched in coordination with international authorities, and called on global powers to prevent any parties trying to harm maritime safety and security. Saudi Arabia's foreign ministry in a separate statement voiced support for its clsoe regional ally the UAE, the Middle East's trade and business hub. Dubai's stock exchange index fell 1.6% and Abu Dhabi's index 1.7% in early trade on Monday.

ESCALATING TENSIONS Sunni Muslim allies Saudi Arabia and the UAE have strongly backed U.S. sanctions against fellow OPEC producer and regional foe Shi'ite Iran. After the United States ended all sanctions waivers on Iranian crude, Washington said Riyadh and Abu Dhabi would help compensate for any shortage in oil supply.

Falih said the attack aimed to undermine maritime freedom and the security of oil supplies to consumers all over the world. "The international community has a joint responsibility to protect the safety of maritime navigation and the security of oil tankers, to mitigate against the adverse consequences of such incidents on energy markets and the danger they pose to the global economy," he said.

Iran's foreign ministry spokesman Abbas Mousavi was cited by the semi-official ISNA news agency as saying the incident off Fujairah "has negative impact on maritime transportation security" and asked for regional countries to be "vigilant against destabilising plots of foreign agents". The U.S. Maritime Administration said in an advisory on Sunday the incidents off Fujairah, one of the seven emirates that make up the UAE, have not been confirmed and urged caution when transiting the area. It said "the precise means of attack or sabotage is unknown".

Earlier this month, the Maritime Administration said U.S. commercial ships including oil tankers sailing through Middle East waterways could be targeted by Iran in one of the threats to U.S. interests posed by Tehran. Washington said it was sending a U.S. aircraft carrier and other forces to the Middle East due to what it said were Iranian threats, while Tehran has called the U.S. military presence "a target" rather than a threat

U.S. President Donald Trump's government has been ratcheting up pressure on Iran with sanctions since Washington withdrew a year ago from a 2015 international nuclear deal between Tehran and world powers. Washington tightened sanctions on Iran this month, eliminating waivers that had allowed some countries to buy its oil, saying it wanted to cut Tehran’s crude exports to zero. Iran has said it will not let its oil exports by halted. (Additional reporting by Jonathan Saul in London and Saeed Azhar in Dubai; Writing by Ghaida Ghantous Editing by Angus MacSwan)