International oil prices closed higher on Tuesday as crude oil loading operations at Yanbu Port, Saudi Arabia's Red Sea export hub, were suspended.

International oil prices closed higher on Tuesday (15th). (Reuters)

[Financial Channel/Comprehensive Report] International oil prices closed higher on Tuesday (15th) after shipping industry sources said that crude oil loading operations at Yanbu Port, Saudi Arabia's Red Sea export hub, have been suspended, and Riyadh also canceled some cargoes destined for European customers, deepening market concerns that disruptions to a key oil export route may last for weeks.

Brent crude oil futures rose $3.07, or 2.9%, to close at $108.75 a barrel.

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U.S. West Texas Intermediate crude oil (WTI) futures in New York rose $4.44, or 4.38%, to close at $105.83 per barrel. Both contracts closed at their highest levels since May 19.

WTI futures rose more than Brent crude futures as concerns about expanding supply problems in Saudi Arabia prompted investors to rush to buy U.S. crude as an alternative.

Since the closure of the Strait of Hormuz due to the U.S.-Israeli war against Iran, the importance of Yanbu port to global supplies has increased significantly. The Strait of Hormuz is a key waterway through which about one-fifth of the world's oil and liquefied natural gas supplies are transported.

The war forced Saudi Arabia to switch to transporting crude oil westward, using the East-West Pipeline, which is about 1,200 kilometers long, to transport oil from the east to Yanbu on the west coast, so that exports can be shipped through the Red Sea without allowing tankers to pass through the Strait of Hormuz.

However, the pro-Iran Yemeni rebel "Youth Movement" (Houthis, Houthis) attacked the east-west pipeline, forcing Saudi Arabia to close this key export route.

Supply doubts further intensified as youth movements launched fresh attacks on Saudi Arabia on Monday and Gulf Arab states postponed scheduled discussions with Iran.

Oil loading operations at Saudi Arabia's Red Sea export terminal Yanbu have been suspended, shipping industry sources told Reuters on Tuesday. Before the news broke, sources said that Riyadh had informed European customers that some crude oil cargoes at the end of September would be cancelled.

Andy Lipow, president of Lipow Oil Associates, said Saudi Arabia's cancellation of some crude oil shipments to Europe has strengthened market expectations that European refiners will turn to U.S. supplies, which will help push up the price of WTI relative to Brent crude.

Li Bao said traders have been buying WTI futures, betting that disruptions to Saudi Arabia's oil exports will last longer than expected. He added that because U.S. refiners can easily switch between different crude grades, demand for sweet crude such as WTI may increase, further supporting oil prices.

Buyers and traders say Saudi Arabia could run out of crude for export within days unless the east-west pipeline resumes operations. This pipeline attack threatens up to 4% of the global oil supply.

Goldman Sachs said in a report that the latest repair assessment times ranged from "very fast" to eight weeks.

U.S. Energy Secretary Chris Wright told "CNBC" on Tuesday that Saudi Arabia's important east-west pipeline should resume oil shipments within days.

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