A ministry statement, published on state media, did not name the firm involved in the deal with the Syrian Democratic Forces, an alliance that seized swathes of north and east Syria from the Islamic State with US help.

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The statement did not give details on the agreement. There was no immediate response from SDF officials to a Reuters' request for comment. There was no immediate comment from US officials.

Damascus "condemns in the strongest terms the agreement signed between al-Qasd militia (SDF) and an American oil company to steal Syria's oil under the sponsorship and support of the American administration," the statement said.

"This agreement is null and void and has no legal basis," it said, adding that it was a violation of Syrian sovereignty.

Syria produced around 380,000 barrels of oil per day before a civil war erupted following a crackdown on protests in 2011, with Iran and Russia backing President Bashar al-Assad's government and the United States supporting the opposition.

Damascus lost control of most oil-producing fields in a stretch east of the Euphrates River in Deir al-Zor. Western sanctions have also hit the energy industry.

US President Donald Trump has said that despite a military pullback from northeast Syria, a small number of American forces would remain "where they have oil." The Pentagon said late last year that oilfield revenues would go to the SDF.

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According to Netanyahu, Tehran's ambition is to obtain the capacity to launch a precision strike on any target in the Middle East.

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On Monday, Mnuchin pledged to increase economic sanctions against Iran. He says the administration's "maximum pressure campaign" is halting Iranian aggression.

Mnuchin met Monday in Jerusalem with Netanyahu, who called on Washington to impose additional sanctions to stop what he called Iran's "plunge for everything" in the Middle East.

At a joint press conference, Netanyahu said Iran's ability to project power in the region "is diminished to the extent that you can tighten your sanctions and make the availability of cash more difficult for them."

Mnuchin is heading a delegation to the Middle East and India to discuss economic ties and counterterrorism initiatives. He is joined by US President Donald Trump's senior adviser and son-in-law Jared Kushner, who was to meet with Netanyahu and his key rival, Blue and White party leader Benny Gantz.

Mnuchin says American sanctions aim to force Iran to stop "their bad activities and exporting terrorism, looking to create nuclear capabilities, and missiles."

Earlier Monday, the International Monetary Fund reported that Iran would need oil priced at $194.6 a barrel to balance its budget next year.

Hurt by tighter US sanctions, Iran – a key member of the Organization of the Petroleum Exporting Countries (OPEC) – is expected to have a fiscal deficit of 4.5% this year and 5.1% next year, the fund said in a report on Monday.

On Friday, international benchmark Brent crude closed trading at just above $62 a barrel.

Iran saw its oil revenues surge after a 2015 nuclear pact agreed with six major powers ended a sanctions regime imposed three years earlier over its disputed nuclear program.

Iran's economy is expected to shrink by 9.5% this year, compared to a prior estimate of a 6% contraction, the IMF has said, but real gross domestic product (GDP) growth is expected to be flat next year.

Parts of this article were originally published by i24NEWS

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"We don't need Middle Eastern Oil & Gas, & in fact have very few tankers there, but will help our Allies!" Trump wrote in a post on Twitter.

Trump said on Sunday the United States was "locked and loaded" for a potential response to the attack on Saudi Arabia's oil facilities.

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Meanwhile, Russia on Monday urged countries in the Middle East and outside the region not to draw "hasty conclusions" on who staged the attacks on Saudi oil facilities.

A senior US official said earlier that evidence from the attack, which hit the world's biggest oil-processing facility, indicated Iran was behind it, instead of the Yemeni Houthi group that had claimed responsibility.

Kremlin spokesman Dmitry Peskov, asked about the US statement, said: "We have a negative attitude towards rising tensions in the region and call for all countries in the region and outside of it to avoid any hasty steps or conclusions which may deepen destabilisation."

In a separate statement on Monday, Russia's foreign ministry said it believed that the exchange of strikes on civilian targets was "a direct consequence of the ongoing sharp military and political crisis in Yemen."

"We believe it is counterproductive to use what happened to increase tensions around Iran in line with the well-known US policy," the foreign ministry said.

"Proposals on tough retaliatory actions, which appear to have been discussed in Washington are even more unacceptable."

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The disappearance of the Adrian Darya 1, formerly known as the Grace 1, follows a pattern of Iranian oil tankers turning off their Automatic Identification System to try and mask where they deliver their cargo amid US sanctions targeting Iran's energy industry.

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US President Donald Trump's withdrawal from the 2015 nuclear deal and the imposition of heavy economic sanctions on Iran have blocked it from selling its crude oil abroad, a crucial source of government funding for the Islamic Republic. Meanwhile, tensions have spiked across the Persian Gulf over mysterious tanker explosions, the shooting down of a US military surveillance drone by Iran and America deploying more troops and warplanes to the region.

The Adrian Darya, which carries 2.1 million barrels of Iranian crude worth some $130 million, switched off its AIS beacon just before 4 p.m. GMT Monday, according to the ship-tracking website MarineTraffic.com. The ship was some 45 nautical miles (83 kilometers) off the coast of Lebanon and Syria, heading north at its last report.

Earlier, US Secretary of State Mike Pompeo had alleged the US had intelligence that the Adrian Darya would head to the Syrian port of Tartus, just a short distance from its last reported position.

The actions of the Adrian Darya follow a pattern of other Iranian ships turning off their trackers once they reach near Cyprus in the Mediterranean Sea, said Ranjith Raja, a lead analyst at the data firm Refinitiv.

Based on the fact Turkey has stopped taking Iranian crude oil and Syria historically has taken around 1 million barrels of crude oil a month from Iran, Raja said it was likely the ship would be offloading its cargo in Syria. That could see it transfer crude oil on smaller vessels, allowing it to be taken to port, he said.

"The Iranian oil going to Syria is not something new," Raja said. "This is a known fact."

The oil shipment website Tanker Trackers similarly believes the Adrian Darya to be off Syria.

"It is now safe to assume [the ship] is in Syria's territorial waters," Tanker Trackers wrote on Twitter on Tuesday.

Iranian officials haven't identified who bought the Adrian Darya's cargo, only that it has been sold.

The US, which has sought to seize the tanker, alleged in federal court that the ship is owned by Iran's Revolutionary Guard, a paramilitary organization answerable only to Supreme Leader Ayatollah Ali Khamenei. The US recently declared the Guard a terrorist organization, giving it greater power to pursue seizing its assets.

US officials have since warned countries not to aid the Adrian Darya, which previously said it would be heading to Greece and Turkey before turning off its tracker Monday. Authorities in Gibraltar alleged the ship was bound for a refinery in Baniyas, Syria when they seized it in early July. They ultimately let it go after holding it for weeks.

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"Overall, the market is in a delicate situation," Khalid al-Falih told reporters ahead of a ministerial panel meeting of top OPEC and non-OPEC oil producers, including Saudi Arabia and Russia.

He said the Organization of the Petroleum Exporting Countries, of which Saudi Arabia is the de facto leader, would have more data at its next meeting in late June to help it reach the best decision on output.

OPEC, Russia and other non-OPEC producers, an alliance known as OPEC+, agreed to reduce output by 1.2 million barrels per day from January 1 for six months, a deal designed to stop inventories building up and weakening prices.

Russian Energy Minister Alexander Novak told reporters that different options were available for the output deal, including a rise in production in the second half of the year.

United Arab Emirates Energy Minister Suhail al-Mazrouei said oil producers were capable of filling any gap in the oil market and that relaxing supply cuts was not "the right decision."

Mazrouei said the UAE did not want to see an increase in inventories that could lead to a price collapse.

Saudi Arabia sees no need to boost production quickly now, with oil at around $70 a barrel, as it fears a crash in prices and a build-up in inventories, OPEC sources said, adding that Russia wants to increase supply after June.

The United States, which is not a member of OPEC+ but is a close ally of Saudi Arabia, wants the group to boost output to bring oil prices down.

Falih has to find a delicate balance between keeping the oil market well-supplied and prices high enough for Riyadh's budget needs while pleasing Moscow to ensure Russia remains in the OPEC+ pact, and being responsive to the concerns of the United States and the rest of OPEC+, the sources said earlier.

Sunday's meeting of the ministerial panel, known as the JMMC, comes amid concerns of a tight market. Iran's oil exports are likely to drop further in May and shipments from Venezuela could fall again in coming weeks due to U.S. sanctions.

Oil contamination also forced Russia to halt flows along the Druzhba pipeline – a key conduit for crude into Eastern Europe and Germany – in April. The suspension, as yet of unclear duration, left refiners scrambling to find supplies.

Novak told reporters that oil supplies to Poland via the pipeline would start on Monday.

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On Monday, Saudi Arabia revealed that two of its oil tankers were sabotaged off the coast of the United Arab Emirates in attacks that caused "significant damage" to the vessels, one of them as it was en route to pick up Saudi oil to transport to the United States.

Ahmed Aboul-Gheit said in a statement on Monday that these acts are a "serious violation of the freedom and integrity of trade and maritime transport routes."

He says the Arab League stands by the UAE and Saudi Arabia "in all measures taken to safeguard their security and interests."

The announcement by Saudi Energy Minister Khalid al-Falih came as the U.S. issued a new warning to sailors and the UAE's regional allies condemned the reported sabotage on Sunday of four ships off the coast of the port city of Fujairah.

The statement came just hours after Iranian and Lebanese media outlets aired false reports of explosions at the city's port. Emirati officials have declined to elaborate on the nature of the sabotage or say who might have been responsible.

The U.S. has warned ships that "Iran or its proxies" could be targeting maritime traffic in the region. The U.S. is deploying an aircraft carrier and B-52 bombers to the Persian Gulf to counter alleged threats from Tehran.

Shortly after the Saudi announcement, Iran's Foreign Ministry called for further clarification as to what exactly happened with the Saudi tankers. The ministry's spokesman, Abbas Mousavi, was quoted by the official Islamic Republic News Agency as saying that there should be more information about the incident.

Mousavi also warned against any "conspiracy orchestrated by ill-wishers" and "adventurism by foreigners" that would seek to undermine the maritime region's stability and security.

Tensions have risen in the year since President Donald Trump withdrew the U.S. from the 2015 nuclear deal between Iran and world powers, restoring American sanctions that have pushed Iran's economy into crisis. Last week, Iran warned that it would begin enriching uranium at higher levels in 60 days if world powers failed to negotiate new terms for the deal.

In his statement, al-Falih said the attacks on the two tankers happened at 6 a.m. Sunday.

"One of the two vessels was on its way to be loaded with Saudi crude oil from the port of Ras Tanura, to be delivered to Saudi Aramco's customers in the United States," al-Falih said. "Fortunately, the attack didn't lead to any casualties or an oil spill; however, it caused significant damage to the structures of the two vessels."

Saudi Arabia did not identify the vessels involved, nor did it say whom it suspected of carrying out the alleged sabotage.

A statement on Sunday from the UAE's Foreign Ministry put the ships near the country's territorial waters in the Gulf of Oman, east of the port of Fujairah. It said it was investigating "in cooperation with local and international bodies." It said there were "no injuries or fatalities on board the vessels" and "no spillage of harmful chemicals or fuel."

The U.S. Navy's 5th Fleet, which oversees the region, did not immediately offer comment. Emirati officials declined to answer questions from the Associated Press, saying their investigation is ongoing.

Fujairah's port is about 140 kilometers (87 miles) south of the Strait of Hormuz, the narrow mouth of the Persian Gulf through which a third of all oil at sea is traded. The facility handles oil for bunkering and shipping, as well as general and bulk cargo. It is seen as strategically located, serving shipping routes in the Persian Gulf, the Indian subcontinent and Africa.

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"America's decision that Iran's oil exports must reach zero is a wrong and mistaken decision, and we won't let this decision be executed and operational" Rouhani said.

"In future months, the Americans themselves will see that we will continue our oil exports," he said.

If the United States is able to stop one method for Iran to export oil, then it will find other ways, Rouhani said.

Oil prices hit their highest since November last week after Washington said all waivers for sanctions-hit Iranian oil would end this week, pressuring importers to stop buying from Tehran and further tightening global supply.

The United States demanded last Monday that buyers of Iranian oil stop purchases by May 1 or face sanctions, ending six months of waivers that had allowed Iran's eight biggest customers, most of them in Asia, to continue importing limited volumes.

Ordinary Iranians are the ones who feel the pressure from U.S. sanctions, Rouhani said.

Meanwhile, Saudi Energy Minister Khalid al-Falih told Russian state news agency RIA on Tuesday that Saudi Arabia is ready to meet oil consumers' demand by replacing supplies from Iran after the United States ends waivers granted to buyers of Iranian crude.

Falih said that the global deal to coordinate oil production levels could be extended after June.

"We will look at [global oil] inventories – are they higher or lower than the normal level and we will adjust the production level accordingly. Based on what I see now … I am eager to say that there will be some kind of agreement," Falih told RIA.

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In morning trading, benchmark U.S. crude surged $1.52, or 2.4% to $65.57 per barrel in New York. Brent crude, used to price international oils, jumped $1.84, or 2.6% to $73.80.

Ritterbusch and Associates, an oil trading advisory firm, said in a morning note that "a complete elimination of Iranian exports is nearly impossible and that a reduction beyond current levels will likely prove limited."

It said that the overall effect "will hinge to a large degree on the Saudis response to what is likely to be some strong requests from the Trump administration to increase productions appreciably."

U.S. President Donald Trump said on Monday that Saudi Arabia and other OPEC nations could "more than make up" for any drop in Iranian oil supplies to global markets now that his administration has decided to end waivers that allowed some nations to buy Iranian oil without facing U.S. sanctions.

"Saudi Arabia and others in OPEC will more than make up the Oil Flow difference in our now Full Sanctions on Iranian Oil," Trump said on Twitter.

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The United States will fail to cut Iranian oil exports to zero, the semi-official Tasnim news agency on Monday quoted an unnamed Iranian oil ministry source as saying.

U.S. President Donald Trump has decided not to reissue waivers in May allowing importers to buy Iranian oil without facing U.S. sanctions, the White House said in a statement on Monday.

Separately, the commander of the Revolutionary Guards' navy said Iran would close the Strait if Tehran is barred from using it.

"According to international law, the Strait of Hormuz is a marine passageway and if we are barred from using it, we will shut it down," the semi-official news agency Fars quoted General Alireza Tangsiri as saying on Monday.

"In case of any threat, we will have not even an iota of doubt to protect and defend the Iranian waters," Tangsiri added.

Tasnim quoted the unnamed source as saying: "Whether the waivers continue or not, Iran's oil exports will not be zero under any circumstances unless Iranian authorities decide to stop oil exports ... and this is not relevant now."

"We have been monitoring and analyzing all possible scenarios and conditions for the advance of our country's oil exports, and necessary measures have been taken ... Iran is not waiting for America's decision or the lack of it to export its oil," Tasnim quoted the source as saying.

"We have years of experience in neutralizing efforts by enemies to strike blows against our country," the source added.

Iran has threatened to disrupt oil shipments through the Strait of Hormuz, a major oil shipment channel in the Gulf, if the United States tries to strangle Tehran's economy by halting its oil exports.

Meanwhile, Saudi Arabia said on Monday it would coordinate with other oil producers to ensure an adequate crude supply and a balanced market after the United States said it would end waivers granted to buyers of Iranian oil.

"Saudi Arabia is closely monitoring the oil market developments following the recent statement from the U.S. government regarding oil export sanctions on Iran," Energy Minister Khalid a-Falih said in a statement.

"Saudi Arabia will coordinate with fellow oil producers to ensure adequate supplies are available to consumers while ensuring the global oil market does not go out of balance."

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