Attacks on crucial oil sites in Saudi Arabia Saturday threatened to renew tensions in the Gulf amid hopes for diplomatic progress between the United States and Iran.
Suggestions that President Donald Trump could lift some sanctions in an effort to bring Tehran to the table, as well as the departure of Trump's hawkish national security adviser John Bolton, had raised hopes for a thaw in relations after a tense summer.
But the two countries traded accusations after Saturday's attacks, leaving the region once again on edge.
Yemen's Iran-backed Houthi rebels claimed its drones struck one of the world's largest oil processing facilities and a major oilfield operated by Saudi Aramco early Saturday, sparking a huge fire at a processor crucial to global energy supplies.
Secretary of State Mike Pompeo blamed Tehran directly, saying there was no evidence the attacks were from Yemen.
"Amid all the calls for de-escalation, Iran has now launched an unprecedented attack on the world’s energy supply," he said on Twitter.
On Sunday, Trump added: "There is reason to believe we know the culprit, are locked and loaded depending on verification, but are waiting to hear from the Kingdom as to who they believe was the cause of this attack, and under what terms we would proceed!"
Iran hit back earlier Sunday, dismissing the U.S. accusations as "pointless" and “blind and futile comments.”
Foreign Minister Mohammad Javad Zarif blasted Pompeo.
“Having failed at maximum pressure, he said on Twitter early Sunday, "Secretary Pompeo is turning to maximum deceit.”
The Trump administration’s "maximum pressure" campaign is designed to squeeze Iran’s economy until its leadership is forced to curtail its aggression in the region and concede to U.S. demands to dismantle its nuclear program.
Bolton’s abrupt departure on Tuesday came after Trump suggested he might lift some U.S. sanctions as an incentive for Tehran to come to the negotiating table, according to a person close to Bolton.
Tensions between the two countries have been growing since Trump withdrew from Iran's 2015 nuclear deal with world powers. Iran has since taken a series of steps to break with the agreement.
Trump said recently he could meet with Iranian President Hassan Rouhani, perhaps later this month on the sidelines of the United Nations General Assembly session in New York. But on Monday, Iran's foreign ministry spokesman said that such a meeting will not take place, Reuters reported. Iranian officials have repeatedly rejected a meeting and any talks with Washington while Iran is subject to sanctions.
Meanwhile, Iraq denied on Sunday that its territory had been used to carry out Saturday's attack after some speculation in the media.
Iraqi Prime Minister Adel Abdul Mahdi's office said Pompeo told Mahdi in a phone call on Monday that the U.S. had information confirming the Iraqi government's assertion.
Both Russia and China on Monday urged all sides to exercise caution and not make any hasty conclusions.
Yemen crisis turns regional
Tensions in the region had seemed to be in a temporary lull, but experts did not expect that to last after Saturday's incident.
“The expectation that the Yemen conflict could heat up on the back of this incident — there is a high degree of possibility there," Mohammad Darwaza, director of geopolitics and energy at Medley Global Advisors, told NBC News.
A Saudi-led coalition has been battling the Tehran-backed Houthi rebels in Yemen since March 2015.
The U.S. provides billions of dollars of arms to the Saudi-led coalition. Trump vetoed a bill to end the assistance in April.
Houthi military spokesman Yahia Sarie said Saturday the rebels launched 10 drones in their coordinated attack on the Saudi oil sites. He warned attacks by the rebels would only get worse if the war continues.
The Houthis hold Yemen's capital, Sanaa, and other territory in the Arab world's poorest country. The war has triggered a humanitarian crisis.
But while Yemen's war has raged largely off the international radar, the region became a focal point of global interest a few months ago after a series of confrontations threatened to explode into conflict.
The U.S. accused Iran of attacking two oil tankers and shooting down its surveillance drone, culminating in a decision to conduct military strikes that were only called off by Trump at the last minute.
Iran has also seized a number of foreign vessels in the Strait of Hormuz, placing the world's oil supply at the heart of the simmering regional tensions.
Pompeo said Saturday the U.S. will work with its partners and allies to ensure energy markets remain well supplied amid fears the attacks could lead to a temporary loss of more than 5 percent of global supply.
Oil prices spiked shortly after trading began Monday as uncertainty about how the events could unfold in the region grew.
Saudi Arabia is the world's biggest exporter of oil and for years has served as the supplier of last resort to markets.
“Not only have we lost oil production from Saudi Arabia, the market is now anticipating that there may be a retaliatory attack or an impact on Iran," Andrew Lipow, president of Lipow Oil Associates, told NBC News.
A senior Trump administration official told NBC News Saturday that the attack, involving supplies vital to the global economy, "is one of the most provocative in a 40-year pattern of escalatory violence" from Tehran.
It "completely contradicts the regime's hypocritical calls for diplomacy," the official said.
Pompeo’s claims about Iranian culpability did spark criticism from some back home.
“This is such irresponsible simplification and it’s how we get into dumb wars of choice,” said Sen. Chris Murphy, D-Conn, who sits on the Senate Foreign Relations Committee.
In the Mideast, Saudi allies condemned the attacks.
The United Arab Emirates, which is part of the Saudi-led coalition fighting in Yemen, said Sunday they amounted to "new evidence of terrorist groups looking to undermine security and stability in the region.”
Yemen's Saudi-aligned government said the attacks were “a serious threat not only to the Kingdom but to the security and stability of the region as a whole.”