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Michael Kern

Michael Kern

Michael Kern is a newswriter and editor at Safehaven.com and Oilprice.com, 

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$100 Oil? Drone Strikes Halt Half Of Saudi Crude Production


Half of Saudi Arabia's oil production has gone offline following a surprise drone strike.

Drones attacked Abqaiq facility in Saudi Arabia and the Khurais oil field run by Saudi Aramco early Saturday morning, the kingdom's interior ministry said, sparking a massive fire at a crude processing plant essential to global oil supplies.

The closure will impact nearly 5 million barrels of crude processing per day, affecting 5 percent of the world's daily oil production. And while Aramco is confident that it can recover quickly, if it can't, however, the world could face a production shortage of as much 150MM barrels per month. An outcome which could send oil prices into the triple digits.

Houthi rebels-- who are backed by Iran in a yearlong Saudi-led battle in Yemen-- have apparently asserted responsibility for the strikes and pledged that more assaults can be expected in the future.

A Houthi spokesperson explained, “We promise the Saudi regime that our future operations will expand and be more painful as long as its aggression and siege continue," adding that the attack involved ten drones.

The Iran-backed Houthis have recently been behind a number of assaults on Saudi pipelines, vessels and other energy infrastructure as tensions grow in the region. Related: U.S. And Russia Battle It Out Over This Huge Iraqi Gas Field

There have been no details on the severity of the damage but Agence France-Presse quoted interior ministry spokesperson Mansour al-Turki as saying that there were no human casualties as a result of the attack.

More Attacks To Come?

This latest strike highlights the risk posed by the Houthis to Saudi Arabia's oil infrastructure as tensions between the groups continues to escalate.


The growing power of the Houthis' drone operations is likely to reignite the debate on where the militant group is securing these weapons. It could very well be that the group has weaponized noncombatant drones, or in a darker scenario, they are receiving the militarized drones from Iran.

A Saudi-led coalition has been at war with the Houthi movement in Yemen since March 2015. The Iranian-backed rebels hold the funding, Sana'a, and other areas in the Arab world's most impoverished nation.

The battle has created one of the world's worst humanitarian crisis. The violence has pressed Yemeni citizens to the brink of starvation. And the death toll has soared to more than 90,000 individuals since 2015, according to the US-based Armed Conflict Location & Event Data Project, which tracks the conflict.

By Michael Kern for Oilprice.com

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  • Peter B on September 14 2019 said:
    Are these two facilities responsible for half of Saudi production? That seems like a lot
  • DAVID CULVER on September 14 2019 said:
    This just may be the event that saves the American oil producers from bankruptcy!
  • DAVID CULVER on September 14 2019 said:
    This may be the event that saves the American oil producers from bankruptcy!
  • Hugh Williams on September 14 2019 said:
    I think that the main reason the Saudi government has not directly attacked any Iranian targets is because Iran has missiles that could level the Abqaiq and Res Tanura facilities. Would Iran do this? My guess is they would not because it would deprive the Chinese of oil.

  • Charlie Gee on September 14 2019 said:
    Great news!
  • Bill Simpson on September 14 2019 said:
    Well that was easy! The weapons were more like flying bombs than 'drones'. You have to wonder where they were produced, since they must have been quite sophisticated to be able to fly hundreds of miles and hit their target.
    Looks like I may have bought my big generator just in time, in case the war spreads.
    This never happened while Obama was president. Ever get the feeling that the global order is starting to unravel? Yes it is. And it's only just begun. The next decade is going to be rough.
  • John Di Laccii on September 14 2019 said:
    Aramco IPO will go down the drain with this. Who is going to buy such bonds, of the company in a war zone? Panic mode for royals. How many casualties are there? Secret as always, same as fire in Al Khobar housing a few years ago. Same as that journalist. This is very stressful for MBS for sure. Lindsey my dear, please arrange yourself. MBS will need you for R&R.
  • Krishnan Unni on September 15 2019 said:
    How convenient that a drone strike at two oil facilities happen only days after the new Aramco Chief takes over. Maybe the conversation went like this:

    King: I need big oil price.
    Prince: But how?
    Aramco Chief: Let's just blow up two oilfields and blame it on whoever we don't like.
    King: You dirty son-of-a-camel! I knew you had it in you! See Prince, always trust family members!

    If this doesn't raise prices, then expect further 'reshuffles' at Aramco. As for the others, it's "keep calm and carry on" time.
  • J P on September 15 2019 said:
    Since the Saudis need an oil price of $80 to finance it´s budget i guess they should not be complaining to much.
  • Tripp Mills on September 15 2019 said:
    Just a note to our friends in Saudi Arabia - while this is unfortunate (and being a U.S. ally, I watch very closely and hope you all are doing o.k.). While I cant speak for everyone in the United States, I can speak for my fund in stating that I am looking forward to your IPO and whoever did this needs to write a check! The United States (America) is about free and unfettered markets (if I am mis-speaking please feel free to admonish me OP or anyone). To any of the Presidential candidates reading this here in the United States (I was thinking this morning while watching Bill Hemmer - why does the democratic (members interfere with the U.S. oil markets by stating that there will be bans here bans there and no fossil fuels by whatever date - note to you all, do you own any positions in any of these companies? Have you risked capital? Are you an expert on the world energy markets (I heard a very smart set of things last night on a show - one of them is we need to fuel ourselves! So hopefully you all have straws or a BIG checkbook to correct any economic damage you have caused (meaning bankrupt companies and impeachment before you hit the white house if you happen to win - I hate to say this however I don&#039;t trust anyone anymore really so that&#039;s just my opinion). All the best, Tripp (I'm really trying to have some degree of faith in people running for President however when I hear certain things it makes me lose faith in the American Way!). Think about that everyone - the markets are not a playtoy for everyone - it is serious business! Tripp NEWSMEDIA: Why is there no detailed follow up when you all do the debates on this stuff? Candidates can't just put companies and industries out of business because its not their money and time and frankly its decades of work product etc. and a lot of other things (THINK CANDIDATES BEFORE YOU INSULT LOTS OF PEOPLE!) No disrespect meant for anyone so please don't take this as an insult. Have a great rest of day....Tripp
  • Ray Douglas on September 15 2019 said:
    'This latest strike by Houthis highlights the risks to Saudi oil infrastructure'.
    No. This latest strike by Houthis exposes the usefulness of US Patriot Missile defense system.
    That is: Useless.
  • Brent Jatko on September 17 2019 said:
    I'm hesitant to believe any Republican (or Saudi theocrat for that matter) when it comes to ME affairs.

    GWB and his master Cheney lied us into Iraq and we are still paying the price.

    Better to let the two theocracies mutually annihilate each other so we can get off imported oil for good IMO.

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