By Mohammed Ghobari , Nayera Abdallah and Bo Erickson
ADEN/DUBAI, Sept 14 (Reuters) - Middle East diplomacy appeared to falter heading into Monday with the postponement of a meeting between Iran and other Persian Gulf powers, while fresh attacks around the region's two most important oil transit routes deepened concern over global energy supplies.
Oil prices jumped as markets reopened on Monday, following developments that threaten supplies from the world's biggest exporter, Saudi Arabia, which kept
a key 1,200-km (745-mile) east-west pipeline closed throughout the weekend after it was damaged in drone strikes on Friday.
Hopes for a diplomatic breakthrough in the near term faded when Oman's foreign minister, Sayyid Badr Albusaidi, posted late Sunday that a regional meeting scheduled for Monday had been postponed "in the interests of consensus."
Iranian officials had said they would attend that gathering with Gulf Arab states to present an agreement with Oman on governing shipping routes through the Strait of Hormuz.
Iran's Fars news agency cited an Iranian foreign ministry official as saying that the Oman meeting was postponed at the request of some regional countries in a decision jointly made by Tehran and Muscat. The official said Iran would coordinate with Oman to determine a suitable date for holding the meeting.
The postponement came on the heels of Saudi Arabia's decision to shut down, at least for now, its pipeline that has served as the main route for Middle East oil bypassing the Strait of Hormuz.
Meanwhile, the strait continued to pose risks for oil shipping, with the British maritime security agency UKMTO saying on Sunday that a vessel had been struck by a projectile as it moved through the Strait of Hormuz, causing a fire and forcing the crew to be evacuated.
Iran, for its part, said one person was killed and four crew wounded aboard an Iranian commercial vessel struck off its coast.
U.S. DIESEL HITS ANOTHER RECORD
Oil prices surged above $100 last week for the first time since July. The politically sensitive retail price of diesel fuel in the United States rose on Sunday to another all-time high above $6.20 a gallon.
Traders and Saudi oil buyers told Reuters on Sunday that Riyadh has enough oil stored at its Red Sea port of Yanbu to maintain exports for just five to seven days if the pipeline struck on Friday remains shut.
After that, as much as 4% of global oil supply could be jeopardised, on top of the millions of barrels a day already lost to the disruption to traffic through the Strait of Hormuz.
Saudi Arabia has not given full details of the extent of damage to its pipeline or said how long it will remain offline. Sources who spoke to Reuters have given conflicting estimates for the time needed to fix it, ranging from days to weeks. Satellite images have shown huge columns of smoke from locations along the pipeline.
The recent uptick in violence tied to the war that the United States and Israel launched six months ago follows a quiet August in which flows of Middle East oil had trickled back up.
In an interview with London-based pan-Arab news outlet Al-Arabi Al-Jadeed, Iran's Foreign Minister Abbas Araqchi said despite any agreement with Oman, Iran would not reopen the strait until the United States satisfies Tehran's demands.
The U.S. has so far failed to achieve the objectives President Donald Trump set out when he launched "Operation Epic Fury" in February: to end Iran's nuclear programme, prevent it from being able to attack its neighbours and create conditions for its people to topple their rulers.
On a weekend trip to Ireland that included attending the Irish Open golf tournament, Trump reiterated that he still expected the Iran war to end this year, possibly just after U.S. midterm elections in November, and then the price of gasoline would "drop like a rock".
HOUTHI ATTACKS CONTINUE
In Saudi Arabia, state media released video of damage to homes and a mosque from the latest purported cross-border attack by Yemen's Iran-aligned Houthi rebels in Jazan province in the south. The Houthis claimed separately to have struck a Saudi military base in a neighbouring province following their capture of Perim Island in the Bab El-Mandeb, the "Gate of Tears" strait that controls the mouth of the Red Sea.
The Houthi advance along the Red Sea coast is part of the biggest eruption of fighting in Yemen for years.
Their advance and their attacks on Saudi Arabia pose a new dilemma for Washington, which wants to support its Saudi allies and protect shipping but is wary of joining war on another front. The Houthi attacks have also left Gulf states with a difficult choice: accept growing economic pain or engage with Iran.
The United States bombed the Houthis for two months in 2025, but Trump halted that campaign after announcing the group had lifted a threat to attack Red Sea shipping.
Three sources told Reuters that Saudi Arabia's de facto leader, Crown Prince Mohammed bin Salman, phoned Trump on Thursday asking for military aid to fight the Houthis, but was offered only intelligence support for now.
Trump acknowledged on Saturday that he had spoken to the crown prince, and said the Houthis had also phoned the U.S. administration, asking Washington to keep out of the Yemen war.
(Reporting by Mohammed Ghobari in Aden, Eman Abouhassira, Maha El Dahan, Nayera Abdallah, Elwely Elwelly, Yasmine Ghania, Menna Alaa El-Din and Ahmed Tolba in Dubai and Cairo, and Alex Lawler and Dmitry Zhdannikov in London; Additional reporting by Andrew Mills in Doha, Timour Azhari in Riyadh, Ahmed Rasheed in Baghdad and Bo Erickson in Ireland; Writing by Peter Graff and David Brunnstrom; Editing by Andrew Heavens, Aurora Ellis and Nick Zieminski)
