Saudi Arabia asserts strength in adversity

Houthi attempts to target Ras Tanura terminal and Saudi Aramco’s headquarters in Dhahran are not only attacks on Saudi Arabia, but also an assault on the security and stability of global energy supply that threatens the world economy.

Though Ras Tanura, the largest oil-loading terminal in the world, was left unscathed by the strikes, the event represents a serious threat that could send oil prices skyrocketing to unprecedented levels.

Global oil markets still remember the aftermath of the September 2019 attacks on Abqaiq, the world’s biggest oil-processing plant. The attack was the most severe and destructive in the history of the industry, resulting in a temporary suspension of 5.7 million barrels per day, almost half the Kingdom’s production. But the strike designed to cripple Saudi Arabia’s biggest industry and skew the world’s oil supply has been consigned to history as little more than a blip.

However, the 2019 attack caused the highest daily oil price spike in history, rising to $71 per barrel. That surge was short-lived as the price soon fell back to the mid-60s when traders realized production was only briefly interrupted and that crude oil exports had swiftly restarted after just 36 hours.

The Houthi targeting of Ras Tanura is a desperate attempt that will fail to achieve its goals. These attacks on Saudi oil facilities are a great opportunity to prove the reliability and solid dependability of Saudi Aramco and its facilities in dealing with threats to global energy supply.

Decades ago, the vision of Saudi Arabia’s founder, King Abdul Aziz, led to the Kingdom becoming the largest oil exporter and one of the strongest G20 economies. This month is the 83rd anniversary of the first discovery of oil in commercial quantities in Saudi Arabia.

Any outage resulting from attacks on Saudi oil facilities will harm not only Saudi production, but also oil supply around the world, especially given the lack of spare capacity in many global refineries.

Faisal Faeq

During these 83 years, Saudi Aramco has built a great oil infrastructure.

Saudi crude oil is the first to be processed in highly sophisticated refineries around the world, with the remaining balance bought from the spot market.

Hence, any outage resulting from attacks on Saudi oil facilities will harm not only Saudi production, but also oil supply around the world, especially given the lack of spare capacity in many global refineries. Therefore, the impact of such attacks will be adversely felt across upstream and downstream global markets.