Oil prices soared after attacks on oil facilities in Saudi Arabia

Oil prices soared after attacks on oil facilities in Saudi Arabia

Oil quotes rise 9-10% on Monday morning after explosions and fires at Saudi oil facilities, which led to a loss of about 6% of world crude production.

Today, the November Brent futures were trading on the London ICE Futures exchange at $ 66.29 per barrel, which is $ 6.07 (10.08%) higher than the closing session on Friday.

October futures for WTI rose by that time on the New York Mercantile Exchange (NYMEX) by $ 4.95 (9.01%), to $ 59.8 per barrel.

The attack on oil production in Saudi Arabia is fueling tensions with Iran

At the peak, the growth of quotations reached 11-13%, the price increase became the highest since February 2016.

On September 14, drones attacked the largest oil refinery in Saudi Arabia, Abkaik, and the Khurais oil field. There were explosions and fire. Oil production was suspended in the amount of 5.7 million barrels per day, that is, about half of the total volume produced in the country.

The Abkayk refinery normally produces about 9.8 million bpd and is considered one of the largest enterprises in the world. The suspension of the Abkayk refinery and Khurais field was confirmed by Energy Minister Prince Abdel Aziz bin Salman Al Saud. He assured that the fire at the facilities was “taken under control”.

“In my opinion, Saudi Arabia will be able to restore oil production in the amount of 3 million bpd in the next 2-5 days, but it will take more time to return another 2.7 million bpd, taking into account the peculiarities of the Abkayk refinery,” said the analyst on the energy sector of Mizuho Securities Robert Jager.

Saudi oil facilities have been attacked more than once in recent months, but drone attacks have inflicted severe damage to the country’s oil infrastructure. It also recalled that tensions in the Middle East persist, and could jeopardize the supply of oil from the region to the world market, writes MarketWatch.

By Monday evening, Saudi Arabia plans to recover about a third of its production, reduced due to the incident.

The Hussite Yemeni rebels claimed responsibility for the attack on Saudi targets, while US Secretary of State Mike Pompeo blamed Iran for this, noting that there was no evidence that the attacks came from Yemen.

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Amit Kumar
Amit Kumar is editor-in-chief and founder of Revyuh Media. He has been ensuring journalistic quality and shaping the future of Revyuh.com - in terms of content, text, personnel and strategy. He also develops herself further, likes to learn new things and, as a trained mediator, considers communication and freedom to be essential in editorial cooperation. After studying and training at the Indian Institute of Journalism & Mass Communication He accompanied an ambitious Internet portal into the Afterlife and was editor of the Scroll Lib Foundation. After that He did public relations for the MNC's in India. Email: amit.kumar (at) revyuh (dot) com ICE : 00 91 (0) 99580 61723