Saudi Arabia said some of the world’s most protected oil infrastructure came under missile and drone attack in an escalation of regional hostilities that sent crude prices surging.
The attacks on Sunday were intercepted, Saudi Arabia said, and oil output appeared to be unaffected.
However, the latest in a spate of assaults claimed by Iran-backed Houthi rebels pushed oil prices to above US$70 a barrel for the first time since January last year.
Photo: Eric Gay, AP
The attacks are the most serious against Saudi oil installations since a key processing facility and two fields came under fire in September 2019, cutting production for about a month and exposing the vulnerability of the kingdom’s petroleum industry. Yemen’s Houthi fighters claimed responsibility for that attack, although Riyadh pointed the finger at archrival Iran.
On Sunday, the Saudi Arabian Ministry of Energy said an oil storage tank farm at the Ras Tanura export terminal on the country’s Persian Gulf coast was attacked by a drone from the sea.
Shrapnel from a missile also landed close to a residential compound for employees of national oil company Saudi Arabian Oil Co (Aramco) in Dhahran. The compound is home to families of Saudi Arabian and expat employees, and there is a US consulate nearby.
Witnesses in the coastal city of Dhahran, where Aramco is also headquartered, reported an explosion rocking the city, and windows shaking.
Ras Tanura is about an hour by car up the coast.
“Both attacks did not result in any injury or loss of life or property,” a ministry spokesman said.
Two people familiar with the situation also said oil output was unaffected.
Brent crude yesterday rose as much as 2.9 percent to US$71.37 a barrel, rising to the highest since January last year.
Oil had already received a boost from an OPEC meeting last week that kept a tight leash on supply.
Ras Tanura is the world’s largest oil terminal, capable of exporting about 6.5 million barrels a day — nearly 7 percent of oil demand — and as such is heavily protected. The port includes a large storage tank farm where crude is kept before it is pumped into super-tankers. A refinery at the same site is Aramco’s oldest and largest.
A Saudi-led coalition has been fighting the Houthis since 2015. The conflict has killed tens of thousands of people and it has triggered what the UN has said is the world’s worst humanitarian crisis.
On Sunday, the Saudi-led coalition said a recent US decision to revoke the designation of the Houthis as terrorists had fueled the rise in attacks.
US President Joe Biden’s administration has moved to ditch the designation after the UN warned of famine.
The administration of former US president Donald Trump adopted the label toward the end of his time as president, and it was seen as a way of increasing pressure on Iran.
Biden during his campaign pledged to rejoin a nuclear pact between Iran and world powers.
“The Houthi attacks on Saudi Arabia will likely further complicate efforts of the Biden administration to negotiate a follow-on nuclear agreement with the Iranians,” Helima Croft, the head of global commodity strategy and Middle East and North Africa research at RBC Capital Markets in New York, wrote in a research note.
The Biden administration would have been placed in a very difficult position if the attacks had resulted in significant casualties or infrastructure damage, after promising to safeguard Saudi Arabia’s security interests, specifically citing the cross-border threat from Yemen, she said.
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