Rystad Energy news flash on Saudi Arabia drone attacks

September 15, 2019

Commenting on reports of drone attacks against vital oil infrastructure in the Kingdom of Saudi Arabia, Per Magnus Nysveen, head of analysis at Rystad Energy, said:

“The air attack by Iranian-backed militia on vital oil processing terminals in the heart of Saud Arabia’s oil region has turned the market on its head over the weekend. From a situation of unprecedented global oversupply risks, the market will have to replace 5 million barrels per day of oil production by pulling from existing stocks until the oil facilities are brought back to safe operations.”

Nysveen added:

“This could take a longer time than the authorities initially are claiming. Despite lower exports this year, Saudi Arabia has also depleted its crude oil stocks to the lowest levels in 10 years, so the country alone does not have the same robustness against Middle East interruptions as it used to have. Also the US cannot quickly replace such volumes quickly, as it takes time to relocate oil tankers, and the US still has limited import capacity by Very Large Crude Carriers (VLCC).

Bjørnar Tonhaugen, head of oil market analysis at Rystad Energy, commented:

"This will trigger a significant pull-down of crude oil stocks held by Saudi Aramco. The immediate impact on crude prices could be around $10 per barrel and we expect the impact could be around $5 dollars for weeks, as the situation in the Middle East just got more fragile."

 

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Contacts

Per Magnus Nysveen
Head of Analysis
Telephone: +47 24 00 42 00
per@rystadenergy.com


Morten Bertelsen
Media Relations
Phone: +47 951 98 742
morten.bertelsen@rystadenergy.com

 

About Rystad Energy

Rystad Energy is an independent energy research and business intelligence company providing data, tools, analytics and consultancy services to the global energy industry. Our products and services cover energy fundamentals and the global and regional upstream, oilfield services and renewable energy industries, tailored to analysts, managers and executives alike. Rystad Energy’s headquarters are located in Oslo, Norway with offices in London, New York, Houston, Aberdeen, Stavanger, Moscow, Rio de Janeiro, Singapore, Bangalore, Tokyo, Sydney, and Dubai.