The phrase from the excerpt that supports the claim that there is something sinister about the island is “a sort of sudden dread” (Option B).
The meaning of dread is feeling great fear. So, if you dread something, it is because you are very afraid of it. In this case, the speaker says that all of the sudden he felt scared and this feeling coincided with them being near the island.
The other options do not really have words that relate to fear to make readers think the island is sinister in any way.