© Reuters. Oil starts the week with gains on fresh Middle East tensions

Investing.com - Oil prices rose sharply in European trading on Monday, after Saudi Arabia and three other countries , fueling concerns over geopolitical instability in the Middle East.

The contract rose 52 cents, or around 1.1%, to $48.18 a barrel by 2:50AM ET (0650GMT).

Elsewhere, for August delivery on the ICE Futures Exchange in London added 56 cents to $50.51 a barrel.

Saudi Arabia, Egypt, the United Arab Emirates and Bahrain severed their ties with Qatar on Monday, accusing it of supporting terrorism, in an unprecedented breach between the most powerful members of the Gulf Cooperation Council.

The coordinated move dramatically escalates a simmering dispute over Qatar's support for the Muslim Brotherhood, the world's oldest Islamist movement, and affects some of the world's biggest oil and gas exporters.

Qatar, a member of the Organization of the Petroleum Exporting Countries, is the biggest supplier of liquefied natural gas (LNG) and a major seller of condensate - a low-density liquid fuel and refining product derived from natural gas.

A split between Doha and its closest allies can have repercussions around the Middle East where Gulf states have used their financial and political power to influence events in Libya, Egypt, Syria, Iraq and Yemen.

Market participants are sensitive to Middle East tensions because they worry about supply disruptions from the region.

Oil suffered its largest weekly loss in a month , dropping more than 4%, amid growing concern over rising shale production in the U.S.

Data from energy services company Baker Hughes showed on Friday that U.S. drillers last week added rigs for the 20th week in a row, the longest such streak on record, implying that further gains in domestic production are ahead.

The U.S. rig count rose by 11 to , extending a year-long drilling recovery to the highest level since April 2015.

The increase in U.S. drilling activity and shale production has mostly offset efforts by OPEC and other producers to cut output in a move to prop up the market.

Last month, OPEC and some non-OPEC producers extended a deal to cut 1.8 million barrels per day in supply until March 2018.

So far, the production-cut agreement has had little impact on global inventory levels due to rising supply from producers not participating in the accord, such as Libya and Nigeria, and a relentless increase in U.S. shale oil output.

Elsewhere on Nymex, for July inched up 0.7 cents, or about 0.5%, to $1.581 a gallon, while July tacked on 0.8 cents to $1.493 a gallon.

for July delivery rose 3.1 cents to $3.030 per million British thermal units.