Saudi Energy Facilities Attacked, Oil Production and Pipeline Flow Plummet

Reuters reported that sources in the Saudi Ministry of Energy did not specify who launched the attack, but Saudi Arabia has intercepted multiple Iranian missiles and drones in recent weeks.

The Saudi Press Agency (SPA) noted that the latest attack, coupled with previous strikes on some facilities, also disrupted operations at key oil, natural gas, refining, petrochemical, and power facilities in Riyadh, Eastern Province, and Yanbu Industrial City.

Since the US and Israel went to war with Iran in late February, Saudi Arabia had not previously provided details on the impact of such attacks on oil field production, refineries, and pipeline flows.

In after-hours trading today, benchmark Brent crude futures prices rose; futures settlement prices had previously risen by $1.17, or 1.2%, to close at $95.92 per barrel.

Matt Smith, an analyst at energy market intelligence firm Kpler, said: "The East-West Pipeline is diverting large quantities of Saudi crude that cannot be shipped through the Strait of Hormuz. Any reduction in throughput will exacerbate tensions. This is not good news for the market."

Israel continues to attack Lebanon, and Iran shows almost no signs of lifting its near-total blockade of the Strait of Hormuz, making the two-week ceasefire announced this week appear precarious. The Strait of Hormuz is a passage for nearly one-fifth of the world's energy supply.

With the strait blocked, the East-West Pipeline has become Saudi Arabia's only crude oil export route. Reuters reported yesterday that Iran attacked this pipeline just hours after the ceasefire agreement was reached. (Compiled by Li Pei-shan) 1150410