X

Sign Up To Our Free Newsletter

Join Now

Thanks for subscribing to our free newsletter!

ERROR

  • 4 minutes IMPORTANT ARTICLE BY OILPRICE.COM EDITOR - "Naked Short Selling: The Truth Is Much Worse Than You Have Been Told"
  • 5 minutes “Cushing Oil Inventories Are Soaring Again” By Tsvetana Paraskova
  • 7 minutes United States LNG Exports Reach Third Place
  • 1 hour Texas forced to have rolling black outs. Not from downed power line , but because the wind energy turbines are frozen.
  • 1 day Wednesday Nikki Haley reached out to Trump for meeting at Mar-a-lago. Trump said No ! You blew it Nikki . . .
  • 1 day NYT:  The Supreme Court’s order (Re:  Trump’s tax returns) set in motion a series of events that could lead to the startling possibility of a criminal trial of a former U.S. president
  • 15 mins Retired RAF pilot wins legal challenge over a wind farm
  • 11 hours Speaker Pelosi, "Tear Down This Wall"
  • 11 hours Disaster looming in UK offshore wind power
  • 11 hours The World Economic Forum & Davos - Setting the agenda on fossil fuels, global regulations, etc.
  • 8 hours Minerals, Mining and Industrial Ecology
  • 3 hours U.S. Presidential Elections Status - Electoral Votes
  • 10 hours Chance for (Saudi)Arabian peninsula having giant onshore Gas too?
  • 10 hours The latest GOP nonsense on Texas shows us the future Republicans want
  • 13 hours Pipeline vs Train vs Ship to Transport Crude Oil.

The Truth And Repercussions Of The Saudi Drone Attack

48 hours ago, the million-dollar question for hedge funds was when the Saudis would be able to bring production back up to full capacity after the multiple, surgical strikes on Aramco facilities Saturday. Supply has now been largely restored, and the damage has been clarified after much panic.

The worst strikes in terms of visible damage based on satellite imagery were the processing facilities at Abqaiq (image 1), with the lower far-left infrastructure being the hardest hit, and to a lesser extent, the Khurais oilfield, which is 180KM southwest of Abqaiq (image 2):

Abqaiq is the key here.

Lack of clarification wreaked havoc on the market for a couple of days, with the Saudis downgrading an initial estimate that they would be able to get significant capacity back online in a matter of days. On Monday, that estimate was changed to a vague range of weeks or months as officials continued to assess the damage and necessary repairs.

On Monday, we advised private clients that there is enough Saudi domestic storage to last just shy of a month, and that the rest would be made up from bringing idle fields back online, while in the end, the effect on the market in terms of supply and demand would be less dramatic than the initial jump in oil prices warranted.

By Tuesday, the markets had largely forgotten about the attack from a technical standpoint. Oil prices pared gains, and the market shifted its focus back to the Fed. The Saudi energy…




Oilprice - The No. 1 Source for Oil & Energy News