Saudi Arabia faces weeks without full oil production after attack

Saudi Arabia faces weeks without full crude and gas production capacity after Saturday’s attack on the world’s most important oil facility.

While some officials in the kingdom have sought to reassure oil markets that production will come back quickly, people briefed on the matter say it could take far longer restore output to its maximum level.

“It will take weeks to ramp up and bring the complex to maximum capacity,” said one person close to the energy ministry.

While the full extent of the damage is still being investigated, the person said there was enough concern that the kingdom was in talks with several Opec countries.

One option could be to call an emergency meeting of the oil producers’ cartel.

The kingdom, which is the de facto leader of Opec, is in the initial stages of assessing whether it will need to ask other member countries to temporarily raise production to calm markets until Saudi Arabia’s output can fully recover.

The discussions are at an early stage and may not materialise into action, the person said.

But given that Saudi Arabia has previously led the group in reducing output to support prices, the talks illustrate the depth of concerns in the kingdom.

The US has blamed Iran for the attacks on Abqaiq, a vital crude processing centre south-west of Saudi Aramco’s headquarters in Dhahran, and the Khurais oilfield, that forced the world’s top crude exporter to suspend more than half its oil production.

The attacks have heightened concerns about the vulnerability of Saudi Arabia’s oil infrastructure as the stand-off between the US and Iran have ramped up tension across the Middle East.

Riyadh is the Trump administration’s closest Arab ally and has been a staunch backer of the US strategy of imposing “maximum pressure” on Iran in an effort to force it to renegotiate its 2015 nuclear agreement with world powers and curb its support for militant groups across the Arab world.

Iran-aligned Houthi rebels, who are fighting a Saudi-led coalition in Yemen’s four-year civil war, have claimed responsibility for what they said was an attack by 10 drones on the two oil facilities.

Mike Pompeo, US secretary of state, accused Iran of launching “an unprecedented attack on the world’s energy supply,” adding that there was “no evidence the attacks came from Yemen.”

Iran on Sunday dismissed the US’s allegations, with the foreign ministry saying Washington’s claims were part of its policy of “maximum lies”.

Mohammad Javad Zarif, Iran’s foreign minister, said having failed at “max pressure” Mr Pompeo was “urning to “max deceit”.

“US & its clients are stuck in Yemen because of illusion that weapon superiority will lead to military victory,” Mr Zarif said on Twitter.

“Blaming Iran won’t end disaster.” Pictures and video posted on social media showed large fires at Khurais, which lies more than 500km from the Yemen border.

For now, markets are well supplied with ample commercial stocks International Energy Agency.