Oil prices spike after Iran seizes yacht

Oil prices jumped Monday after Britian said a racing yacht carrying five U.K. nationals had been stopped by Iranian naval vessels and that they are now being held in Iran.

Crude climbed $1.40 to $77.45 a barrel on the New York Mercantile Exchange after being mostly flat for much of the session.

British officials said Monday that the yacht may have strayed inadvertently into Iranian waters when it was stopped last Wednesday.

Prices rose on the specter of some kind of confrontation between the British and the Iranians, one of the world’s biggest producer of oil.

Two years ago fifteen British military personnel were seized in the Gulf by Iran. Iran charged them with trespassing in its waters, but all were eventually freed.

The jump in prices comes as the gap between what drivers are paying for gasoline compared with a year ago is widening and figures to get worse between now and the end of the year.

AP