Beware of Saudi/UAE Reports of Oil Tanker “Sabotage”
In the span of several days, Saudi Arabia has claimed that two of its oil tankers and a pipeline have been attacked, with the clear implication being that Iran was responsible. The initial reports of a “sabotage attack” on two Saudi oil tankers off the UAE coast (near the Strait of Hormuz) came out of the UAE on Sunday. There have been no details about these attacks, and no evidence whatsoever, with the Saudis saying only that there has been structural damage. Then, on Tuesday, the Saudis said that drones targeted two oil pumping stations along its East-West pipeline, forcing Aramco to halt pumping to evaluate the damage. Output and exports continued without disruption, nonetheless.
The drone attack on the Saudi pipeline has been claimed by Yemen’s Houthis, who align with Iran in what is essentially a proxy war between Saudi Arabia and Iran in Yemen. There is no clear evidence of the alleged attack on the Saudi oil vessels off the UAE coast, but oil prices rose on speculation regardless. Satellite imagery of the vessels does not show any damage, and our assessment of Houthi weaponry suggests that they wouldn’t have reached this area of the coast, nor would they have launched such an attack without claiming it.
The Iranians are using the threat of withdrawing entirely from the nuclear deal to leverage Europe to find a way around US sanctions. It’s a game of…