Drone Attack on Saudi Arabia Facilities Trigger Surge in Oil Prices

A shocking twin attack on the Saudi Arabian oil facilities that destroyed more than five percent of the global oil supply has sent the oil prices surging by a hefty 20 percent across the globe. The drone attacks took place on Abqaiq, the site of Aramco’s largest oil processing plant.

Following the attack, Brent crude, the international oil benchmark used by traders, jumped to $71.95 before cooling down later to $65.76 a barrel. Oil prices in the US also rose but calmed down soon as the release of US reserves was allowed by US President Donald Trump. The US has squarely blamed Iran for the attack. Energy supplies in the region are likely to be affected following the strike in the heartland of Saudi Arabia’s oil industry operated by energy giant Aramco.

Trump later tweeted, “Saudi Arabia oil supply was attacked. There is a reason to believe that we know the culprit, are locked and loaded depending on verification, but are waiting to hear from the Kingdom as to who they believe was the cause of this attack, and under what terms we would proceed!”

Iran is seen as conducting a characteristic weak against the strong war. Many of the tactics they use are being borrowed from the Russians. These include proxies, cyber- operations, and information warfare. They are well aware that the US wants to free its military from future tangles. They are using this for the benefit by upping the pressure levels. Meanwhile, details of the attack are hazy as the Saudis have provided no detailed information apart from denying any casualties. Saudi is the biggest global oil exporter, with more than seven million barrels being shipped out of the kingdom daily. Oil production has dropped by 5.7 million barrels a day. The kingdom has a reserve stock of 188 million barrels.

As on September 6, the US held a stock of 644.8 million barrels of oil in underground salt caverns across various destinations. The country also has 416.1 million barrels of oil in commercial storage.

#donaldtrump #droneattack #oilprices #Saudiarabia

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