PM Daily Market Commentary – 9/12/2019
Yeah, that’ll leave a mark. Besides, the Saud’s needed something to hide their rapidly declining production levels. Can’t pump up that Saudi Aramco IPO unless people believe there’s enough oil still left in the Ghawar to justify the stock price.
“Saudi Arabia shut down half its oil production Saturday after a series of drone strikes hit the world’s largest oil processing facility in an attack claimed by Yemen’s Houthi rebels.
The closure will impact almost 5.7 million barrels of crude production a day, about 5% of the world’s daily oil production, according to Saudi Aramco. In August, Saudi Arabia produced 9.85 million barrels per day, according to the latest figures from the U.S. Energy Information Administration.
Saudi Energy Minister Abdulaziz bin Salman said the attacks also led to a halt in gas production that will reduce the supply of ethane and natural gas liquids by 50%.
Saudi Aramco President and CEO Amin Nasser said nobody was hurt in the attacks and emergency crews have contained the fires and brought the situation under control.
“Work is underway to restore production and a progress update will be provided in around 48 hours,” Nasser said.
Early Saturday, an oilfield operated by Saudi Aramco, the state-owned oil giant, was attacked by a number of drones, which sparked a huge fire at a processor crucial to global energy supplies.
Yemen’s Houthi rebels claimed responsibility for the attack, saying it was one of their largest attacks ever inside the kingdom.
“We promise the Saudi regime that our future operations will expand and be more painful as long as its aggression and siege continue,” a Houthi spokesman said. The attack deployed 10 drones, the Houthis said.
But U.S. Secretary of State Mike Pompeo blamed Iran for the attacks.
“Tehran is behind nearly 100 attacks on Saudi Arabia while Rouhani and Zarif pretend to engage in diplomacy,” Pompeo wrote on Twitter. “Amid all the calls for de-escalation, Iran has now launched an unprecedented attack on the world’s energy supply. There is no evidence the attacks came from Yemen.””
Unfortunately, gold’s price on bullionvault has moved up just a few bucks over the weekend.
I suspect crude will move substantially more, of course, once the markets open on Sunday night.