Saudi Aramco Pumping Stations Targeted in Yemeni Drone Attack
Bloomberg at 7:10 AM ET -- Saudi Arabia said Tuesday that unidentified drones attacked two pumping stations belonging to Saudi Aramco, forcing the state oil company to suspend some operations in the area to assess the damage.
The stations are linked to a pipeline transporting oil from fields in the eastern sector to the port of Yanbu on the western coast, state-run Saudi Press Agency reported, citing the Energy Ministry. Saudi oil exports are continuing as normal, SPA said.
The attack comes amid rising tensions in the Gulf as the U.S. increases pressure on Iran. On Monday, Saudi Arabia said two of its oil tankers were among several vessels attacked while sailing toward the Strait of Hormuz, the world’s most important chokepoint for oil shipments.
Neither Saudi Arabia nor the U.A.E. said exactly what happened to the tankers or identified potential culprits. The manager of one of the tankers hit said, however, that the vessel had got a hole in its hull after being struck by an unknown object off the coast of the United Arab Emirates.
Saudi Arabia Says Oil Tankers Attacked as Iranian Tensions Rise
“These attacks prove again that it is important for us to face terrorist entities, including the Houthi militias in Yemen that are backed by Iran,” SPA said.
Iranian-backed Houthi rebels in neighboring Yemen said earlier in the day that they had targeted key Saudi installations using seven drones, according to the rebel-controlled Saba news agency.
--------------------------------
MY TAKE: All of the Iranian backed terrorist / rebel groups are being ordered by Iran to step up their attacks. This includes Hamas' attack on Israel last week.
Oil Market Updates - May 14
Oil Market Updates - May 14
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Oil Market Updates - May 14
Investing.com - Oil prices rose on Tuesday after reports that unidentified drones attacked two Saudi Aramco pumping stations.
New York-traded West Texas Intermediate crude futures gained 43 cents, or 0.7%, at $61.47 a barrel by 9:22 AM ET (13:23 GMT), while Brent crude futures, the benchmark for oil prices outside the U.S., traded up 67 cents, or 1.0%, to $70.90.
Crude turned positive, spiking to intraday highs, after Saudi Arabia’s oil minister Khalid Al-Flaih announced that “limited” damage had been done and accused Yemen’s Iranian-backed Houthi rebels for carrying out the attack.
Al-Falih added that the East-West pipeline will be closed as a precautionary measure.
Investing.com contributor Ellen Wald noted that the pipeline transports about 5 million barrels per day from fields in eastern Saudi Arabia to the Red Sea port of Yanbu.
“With that shut down, it’s not surprising to see oil up this much,” she tweeted, adding that prices could continue to move higher depending on how long the pipeline is out.
Tensions in the Middle East, that run the risk of tightening supply, have supported oil prices, although escalating trade tensions between the U.S. and China have put downward pressure on oil for the prior three sessions.
Tit-for-tat tariff increases between the world’s two largest consumers of oil have raised fears of exacerbating the global economic slowdown, denting demand for crude.
Apart from the tug of war between bullish factors - Middle East tensions, U.S. sanctions on the likes of Iran and Venezuela - and bearish concerns like the outcome of Sino-U.S. trade talks, doubts also remain over OPEC’s decision in June on whether to continue with production cuts.
Saudi Arabia is thought to favor a continuation of output curbs in order to maintain current price levels.
But Investing.com senior commodity analyst Barani Krishnan said that “oil prices could be entering a new phase of volatility for 2019, breaking from the more enduring rallies of the first quarter.”
Krishnan warned that a seasonal demand spike during the U.S. summer driving season “could be followed by another swell in U.S. crude production and eventually higher stockpiles in the latter half of the year”.
In the meantime, OPEC made no changes to its global oil demand growth forecast for 2019. In its monthly report released on Tuesday, OPEC also said that its output fell by 3,000 barrels per day (bpd) to 30,031 million bpd, while members with quotas in the production cut agreement had compliance of 150%.
New York-traded West Texas Intermediate crude futures gained 43 cents, or 0.7%, at $61.47 a barrel by 9:22 AM ET (13:23 GMT), while Brent crude futures, the benchmark for oil prices outside the U.S., traded up 67 cents, or 1.0%, to $70.90.
Crude turned positive, spiking to intraday highs, after Saudi Arabia’s oil minister Khalid Al-Flaih announced that “limited” damage had been done and accused Yemen’s Iranian-backed Houthi rebels for carrying out the attack.
Al-Falih added that the East-West pipeline will be closed as a precautionary measure.
Investing.com contributor Ellen Wald noted that the pipeline transports about 5 million barrels per day from fields in eastern Saudi Arabia to the Red Sea port of Yanbu.
“With that shut down, it’s not surprising to see oil up this much,” she tweeted, adding that prices could continue to move higher depending on how long the pipeline is out.
Tensions in the Middle East, that run the risk of tightening supply, have supported oil prices, although escalating trade tensions between the U.S. and China have put downward pressure on oil for the prior three sessions.
Tit-for-tat tariff increases between the world’s two largest consumers of oil have raised fears of exacerbating the global economic slowdown, denting demand for crude.
Apart from the tug of war between bullish factors - Middle East tensions, U.S. sanctions on the likes of Iran and Venezuela - and bearish concerns like the outcome of Sino-U.S. trade talks, doubts also remain over OPEC’s decision in June on whether to continue with production cuts.
Saudi Arabia is thought to favor a continuation of output curbs in order to maintain current price levels.
But Investing.com senior commodity analyst Barani Krishnan said that “oil prices could be entering a new phase of volatility for 2019, breaking from the more enduring rallies of the first quarter.”
Krishnan warned that a seasonal demand spike during the U.S. summer driving season “could be followed by another swell in U.S. crude production and eventually higher stockpiles in the latter half of the year”.
In the meantime, OPEC made no changes to its global oil demand growth forecast for 2019. In its monthly report released on Tuesday, OPEC also said that its output fell by 3,000 barrels per day (bpd) to 30,031 million bpd, while members with quotas in the production cut agreement had compliance of 150%.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Oil Market Updates - May 14
Fortune: 'World's Most Important Oil Chokepoint' Is Ground Zero for the Escalating U.S.-Iran Feud
When tensions rise in the Strait of Hormuz, history says trouble is ahead. The strait—which forms a tiny passage from the Persian Gulf to the Gulf of Oman—is the “world’s most important oil chokepoint,” according to the U.S. Energy Information Administration (EIA). The narrow waterway forms a crucial link between the vast oil reserves of the Gulf states and the energy-hungry markets of Asia, and there are almost no alternate throughways. It also has longstanding geopolitical significance, a familiar saber-rattling ground for Iran, the U.S., and the Gulf states at large. On Monday, those tensions rose rapidly, as Saudi Arabia said several of its oil tankers that had passed through the strait had been sabotaged. It’s still not clear the extent of the damage, and no actor has taken responsibility.
The strait is just 21 miles wide, touching Iran on one side, Oman on the other, and serving as the main water transit route to the Persian Gulf states of the UAE, Kuwait, Qatar, Bahrain and Iraq. Its two shipping lanes are just two miles wide each, with another two-mile buffer zone between them. Despite its narrowness, the route is deep enough for the world’s largest oil tankers.
Between 17 million and 18 million barrels per day of crude oil pass through the strait, including 90% of Saudi Arabia’s output, according to Rystad Energy—equivalent to about 40% of the crude traded globally. Meanwhile, the passage is also a significant route for liquid natural gas (LNG) from Qatar, one of the world’s largest exporters.
Read more: http://fortune.com/2019/05/13/us-iran-o ... of-hormuz/
When tensions rise in the Strait of Hormuz, history says trouble is ahead. The strait—which forms a tiny passage from the Persian Gulf to the Gulf of Oman—is the “world’s most important oil chokepoint,” according to the U.S. Energy Information Administration (EIA). The narrow waterway forms a crucial link between the vast oil reserves of the Gulf states and the energy-hungry markets of Asia, and there are almost no alternate throughways. It also has longstanding geopolitical significance, a familiar saber-rattling ground for Iran, the U.S., and the Gulf states at large. On Monday, those tensions rose rapidly, as Saudi Arabia said several of its oil tankers that had passed through the strait had been sabotaged. It’s still not clear the extent of the damage, and no actor has taken responsibility.
The strait is just 21 miles wide, touching Iran on one side, Oman on the other, and serving as the main water transit route to the Persian Gulf states of the UAE, Kuwait, Qatar, Bahrain and Iraq. Its two shipping lanes are just two miles wide each, with another two-mile buffer zone between them. Despite its narrowness, the route is deep enough for the world’s largest oil tankers.
Between 17 million and 18 million barrels per day of crude oil pass through the strait, including 90% of Saudi Arabia’s output, according to Rystad Energy—equivalent to about 40% of the crude traded globally. Meanwhile, the passage is also a significant route for liquid natural gas (LNG) from Qatar, one of the world’s largest exporters.
Read more: http://fortune.com/2019/05/13/us-iran-o ... of-hormuz/
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group