Investing.com - The threat of a sustained outage in Saudi oil supplies to the world may have receded, but the risk of a broader conflict growing out of last weekend’s attacks on its oil facilities may be about to get bigger.
The Saudi Arabian defense ministry is to hold a press conference later Wednesday detailing the extent of Iranian involvement in the attacks, Bloomberg reported a ministry spokesman as saying Wednesday.
President Donald Trump had warned over the weekend that the U.S. was “locked and loaded” as regards a possible retaliatory strike against Iran. However, Saudi Arabia had initially held off confirming U.S. analysis arguing that Iran was behind the strike, rather than the Houthi rebels in Yemen who have repeatedly claimed responsibility for it.
The press conference is expected to take place at 5:30 PM in Jeddah, or 10 AM to 10:30 AM Eastern Time, according to Bloomerg’s Salma Elwardany.
The press conference will follow a meeting between U.S. Secretary of State Mike Pompeo and Saudi Arabia’s Crown Prince Mohammed bin Salman, which was confirmed earlier Wednesday by the U.S. mission to the United Arab Emirates.
Earlier Wednesday, Iran had reportedly sent a written diplomatic note to the U.S. formally disclaiming any involvement in the attacks, which took over half of Saudi Arabia’s active production capacity offline and caused the biggest-ever one-day spike in crude oil futures.
Iran “reiterated that it was not behind attacks on Saudi Arabia's oil facilities and it has warned that any move by America against Iran will get immediate reaction," according to the semi-official news agency ISNA.
On Tuesday, Saudi Energy Minister Prince Abdulaziz bin Salman had said that the kingdom would restore its oil output to pre-attack levels by the end of the month, although restoring its full production capacity would take until November.
Oil prices retreated on the news in early trading Wednesday. By 8:15 AM ET, WTI futures were trading at $58.70 a barrel, down 0.8% from late Thursday and more than $4 a barrel below the high they hit on Monday. The international Brent blend was down 0.6% at $64.17 a barrel.
Saudi Arabia - Press Conference at 10AM ET
Saudi Arabia - Press Conference at 10AM ET
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Saudi Arabia - Press Conference at 10AM ET
President Donald Trump tweeted that he has "just instructed the Secretary of the Treasury to substantially increase Sanctions on the country of Iran!"
No indication of any approval of military action given
Tweet comes as Secretary of State Pompeo meets with Saudi Crown Prince Mohammed bin Salman over possible responses to weekend attacks on Saudi oil installations
WTI Crude oil futures fall to $57.98 a barrel from $58.76 immediately before the tweet.
Brent at $63.63 a barrel vs $63.93 beforehand
"So nice that our Country is now Energy Independent," Trump says in earlier tweet.
No indication of any approval of military action given
Tweet comes as Secretary of State Pompeo meets with Saudi Crown Prince Mohammed bin Salman over possible responses to weekend attacks on Saudi oil installations
WTI Crude oil futures fall to $57.98 a barrel from $58.76 immediately before the tweet.
Brent at $63.63 a barrel vs $63.93 beforehand
"So nice that our Country is now Energy Independent," Trump says in earlier tweet.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Saudi Arabia - Press Conference at 10AM ET
Investing.com -- Oil prices extended losses Wednesday after U.S. President Donald Trump appeared to take near-term military action against Iran off the table in the wake of the attacks on key Saudi Arabian oil installations last week.
Trump said via Twitter that he had “"just instructed the Secretary of the Treasury to substantially increase Sanctions on the country of Iran!" but he made no reference to any possible military response.
Indeed, an earlier tweet suggested that he didn’t see the weekend incident as a real threat to U.S. interests.
“So nice that our Country is now Energy Independent. The USA is in better shape than ever before,” Trump said.
By 9:35 AM ET (1335 GMT), WTI futures were down at $58.12 a barrel, compared to $58.73 a barrel immediately before the two tweets. The international benchmark Brent was at $63.37, down 1.7% on the day and down from $63.92 before the tweets.
Trump's comments were quickly followed by a statement from the International Energy Agency also downplaying any sense of supply emergency.
“For now, markets remain well supplied with ample stocks available,” the Paris-based organization said. “IEA member countries hold about 1.55 billion barrels of emergency stocks in government-controlled agencies, which amount to 15 days of total world oil demand. These can be drawn upon in an emergency collective action and would be more than enough to offset any significant disruption in supplies for an extended period of time.”
Oil prices had already fallen steeply on Tuesday, after Saudi Arabian Energy Minister Prince Abdulaziz bin Salman had said the kingdom expects to restore oil production levels to pre-attack levels by the end of the month.
Trump said via Twitter that he had “"just instructed the Secretary of the Treasury to substantially increase Sanctions on the country of Iran!" but he made no reference to any possible military response.
Indeed, an earlier tweet suggested that he didn’t see the weekend incident as a real threat to U.S. interests.
“So nice that our Country is now Energy Independent. The USA is in better shape than ever before,” Trump said.
By 9:35 AM ET (1335 GMT), WTI futures were down at $58.12 a barrel, compared to $58.73 a barrel immediately before the two tweets. The international benchmark Brent was at $63.37, down 1.7% on the day and down from $63.92 before the tweets.
Trump's comments were quickly followed by a statement from the International Energy Agency also downplaying any sense of supply emergency.
“For now, markets remain well supplied with ample stocks available,” the Paris-based organization said. “IEA member countries hold about 1.55 billion barrels of emergency stocks in government-controlled agencies, which amount to 15 days of total world oil demand. These can be drawn upon in an emergency collective action and would be more than enough to offset any significant disruption in supplies for an extended period of time.”
Oil prices had already fallen steeply on Tuesday, after Saudi Arabian Energy Minister Prince Abdulaziz bin Salman had said the kingdom expects to restore oil production levels to pre-attack levels by the end of the month.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Saudi Arabia - Press Conference at 10AM ET
So much for the big bump. Trump will do anything (nothing is more like it) to keep oil prices down until after the election.