Turkey condemns drone attacks on Saudi oil facilities

Clay Curtis
September 17, 2019

Industry consultant Energy Aspects estimated that the country will be able to restore nearly half the lost production as early as Monday.

The situation was under control at both facilities, Aramco CEO Amin Nasser said.

"Neither us nor the Americans want a war", Brigadier General Amirali Hajizadeh said, quoted by Tasnim news agency, which is considered close to the Guards. "That's really what's going to drive prices".

While markets remained closed on Sunday, the attack could shock world energy prices. Yemen's Houthi rebels claimed responsibility for the attack.

"The US strongly condemns today's drone attacks".

Trump, for his part, affirmed that Washington is allied with Riyadh and supports the kingdom, stressing what he referred to as the negative impact of attacks on the USA and the global economy, according to SPA. Benchmark Brent crude had been trading at just above $60 a barrel. "If it's protracted it could be a big challenge for the oil markets". The Wall Street Journal cited Saudi officials as saying a third of output would be restored on Monday, but a return to full production may take weeks.

Saudi Arabia said Saturday it was ready to respond to drone attacks claimed by Iran-aligned Yemeni rebels on two major oil facilities, which severely disrupted production as Washington blamed Tehran for the strike.

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Saudi Arabia's oil fields and pipeline have been the target of rebel attacks over the past year, often using single drones, but analysts said this appeared to be the biggest and most successful to date.

"Oil prices will jump on this attack, and if the disruption to Saudi production is prolonged, an SPR release ... seems likely and sensible", said Jason Bordoff, founding director of the Center on Global Energy Policy at Columbia University in NY.

The strikes sparked fires at the state-owned Aramco oil plants and prompted furious condemnation from the top U.S. diplomat who blamed Tehran for the strike.

Saturday's attacks caused no casualties but forced a suspension of production at the two plants, where extensive damage was reported from huge explosions triggered by the unmanned aircraft. Riyadh has built five giant underground storage facilities in various parts of the country that can hold tens of millions of barrels of various refined petroleum products, to be tapped during times of crisis. By comparison, Saudi Arabia produced 9.65 million barrels of crude oil a day in July.

"For now, markets are supplied with ample commercial stocks", the IEA said in a statement on Saturday.

Instead of supplying some customers with the usual crude oil grades of Arab Light or Arab Extra Light, the company may offer them Arab Heavy and Arab Medium as a replacement, according to a person familiar with the matter. But four additional plumes to the south-west, over the Ghawar oilfield, the world's largest, were still clearly visible.

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