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Oil Prices Skyrocket After Attack on Saudi Arabia

Disruption

Silhouette three oil pumps

Iran is continuing to up the stakes against the Trump administration by attacking US ally Saudi Arabia and taking a chunk of the global oil supply offline.

The question is how the Trump administration is going to respond:

Oil prices soared on Monday, with Brent crude posting its biggest intra-day percentage gain since the Gulf War in 1991, after an attack on Saudi Arabian oil facilities on Saturday shut about 5% of global supply.

Brent crude futures, the international benchmark, rose by as much as 19.5% to $71.95 per barrel, the biggest intra-day jump since Jan. 14, 1991. The front-month contract was at $66.28 per barrel, up $6.06, or 10.1%, from its previous close, by 0449 GMT.

Saudi Arabia is the world’s biggest oil exporter and the attack on state-owned producer Saudi Aramco’s crude processing facilities at Abqaiq and Khurais has cut output by 5.7 million barrels per day. The company has not given a timeline for the resumption of full output.

A source close to the matter told Reuters the return to full oil capacity could take “weeks, not days.”

“A geopolitical risk premium will return to the oil price,” said Alan Gelder, vice president for refining, chemicals and oil markets at Wood Mackenzie.

 
Doomberg

Written by Doomberg

I am Doomberg, one of the original founding members of Sparta Report, and have been here since the beginning. I am an insatiable news junkie and enjoy reading and writing about the US territories, the Caribbean, video games, smartphones, and of course conservative politics in general.

I also really like pictures of gas stations and claim full responsibility for the silly gas station motif. I'm presently trapped behind enemy lines in a blue state with no hope of escape! The ride never ends.

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