{"id":34622,"date":"2019-09-16T11:12:37","date_gmt":"2019-09-16T10:12:37","guid":{"rendered":"https:\/\/nationalwire.com.ng\/?p=34622"},"modified":"2019-09-16T11:12:37","modified_gmt":"2019-09-16T10:12:37","slug":"oil-prices-surge-by-20-on-drone-strike-on-saudi-arabia","status":"publish","type":"post","link":"https:\/\/nationalwire.com.ng\/sub\/oil-prices-surge-by-20-on-drone-strike-on-saudi-arabia\/","title":{"rendered":"Oil Prices Surge By 20% On Drone Strike On Saudi Arabia"},"content":{"rendered":"

…Brent rises to six-month high of $71<\/i><\/strong><\/p>\n

Crude oil prices have surged more than 19 per cent after a drone strike on a Saudi Arabian oil facility wiped out about five per cent of global supplies.<\/p>\n

Brent prices, according to Bloomberg, jumped as much as $11.73 to $71.95 a barrel in early trading in Singapore.<\/p>\n

State energy producer Saudi Aramco lost about 5.7 million barrels per day of output on Saturday after 10 unmanned aerial vehicles struck the world\u2019s biggest crude-processing facility in Abqaiq and the kingdom\u2019s second-biggest oil field in Khurais.<\/p>\n

For oil markets, it\u2019s the single worst sudden disruption ever, surpassing the loss of Kuwaiti and Iraqi petroleum supply in August 1990, when Saddam Hussein invaded his neighbour. It also exceeds the loss of Iranian oil output in 1979 during the Islamic Revolution, according to data from the U.S. Department of Energy.<\/p>\n

New Zealand petrol prices could reach a nightmare $3 a litre following the attacks on Saudi Arabia\u2019s oil facilities, economist Cameron Bagrie said yesterday.<\/p>\n

However, the true impact the explosions would have on the oil industry remains to be seen.<\/p>\n

As of this morning, the \u201chorror scenario\u201d at this stage would see fuel prices reach $3 at the pump, economist Cameron Bagrie told, a news medium, MediaWorks.<\/p>\n

He said: \u201cIf you look at the imported component of the petrol prices, it\u2019s about 75 cents.<\/p>\n

\u201cLet\u2019s keep the maths simple, let\u2019s say that oil prices basically double, that imported component will go from 75c to $1.50.\u201d<\/p>\n

The global economy could ill afford higher oil prices at a time of economic slowdown, Ole Hansen, head of commodities strategy at Saxo Bank A\/S in Copenhagen, also said.<\/p>\n

Saudi Arabia can restart a significant volume of the halted oil production within days, but needs weeks to restore full output capacity, people familiar with the matter said. The kingdom \u2013 or its customers \u2013 may use stockpiles to keep oil supplies flowing in the short term. Aramco could consider declaring itself unable to fulfil contracts on some international shipments \u2014 known as force majeure \u2014 if the resumption of full capacity at Abqaiq takes weeks.<\/p>\n

That would rattle oil markets and cast a shadow on Aramco\u2019s preparations for what could be the world\u2019s biggest initial public offering. It\u2019s also set to escalate a showdown pitting<\/p>\n

Saudi Arabia and the US against Iran, which backs proxy groups from Yemen to Syria and Lebanon.<\/p>\n

Iran-backed Houthi rebels in Yemen claimed credit for the attack, but U.S. Secretary of State Mike Pompeo blamed Iran directly.<\/p>

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Advertisement<\/div>\r\n\t\t\t\t\t\t\t<\/a>\r\n \r\n\t\t\t\t\t\t\t<\/div>\n

The Trump administration said it\u2019s ready to deploy the nation\u2019s emergency oil reserves and help stabilise markets if needed.<\/p>\n

Local Impact<\/b><\/p>\n

Energy chief executive Mike Bennetts said today that if the impact of the attacks was only felt short term then the outlook was promising.<\/p>\n

\u201cOil in storage is quite high at the moment, so if this was to go on for a week or so it could be easily managed,\u201d he told Mike Hosking Breakfast on Newstalk ZB.<\/p>\n

\u201cIf it\u2019s say a short term disruption, it\u2019s probably worth up to $5 a barrel, or about 5 cents a litre at the pump.<\/p>\n

\u201cIf it\u2019s a more long term disruption, we could be looking at something around $10 a barrel, or 10 cents a litre.\u201d<\/p>\n

BP spokesman Gordon Gillan said the attacks could mean higher prices at the fuel pump.<\/p>\n

\u201cOur prices are reflective of the barrel price, on international markets and other influencing factors, so it\u2019s possible there could be an impact on local prices later this week. But we wouldn\u2019t want to speculate.\u201d<\/p>\n

Asked whether any change to global oil prices would necessarily mean an immediate increase in petrol prices here, he said: \u201cWe review our BP Connect prices every day so our prices are as competitive as possible.<\/p>\n

\u201cIt could change tomorrow, it could be the next day.\u201d<\/p>\n

Meanwhile, jet fuel prices will go up if there is any increase in the cost of crude oil and this could lead to fares rises.<\/p>\n

Fuel makes up at least 25 per cent of airlines\u2019 operating costs and jet fuel is now at $US77 a barrel, nearing the top of the range for carriers to hold prices. Airlines will cut capacity if fuel prices rise steeply and this too can lead to fare increases.<\/p>\n

This year Air New Zealand expects to spend $1.3 billion on fuel, based on an average jet fuel price of $75 a barrel.<\/p>\n

A Government spokesman said there would be no comment on the drone strikes in Saudi Arabia until tomorrow.<\/p>\n","protected":false},"excerpt":{"rendered":"

Crude oil prices have surged more than 19 per cent after a drone strike on a Saudi Arabian oil facility wiped out about five per cent of global supplies.<\/p>\n

Brent prices, according to Bloomberg, jumped as much as $11.73 to $71.95 a barrel in early trading in Singapore.<\/p>\n","protected":false},"author":6,"featured_media":23329,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_exactmetrics_skip_tracking":false,"_exactmetrics_sitenote_active":false,"_exactmetrics_sitenote_note":"","_exactmetrics_sitenote_category":0,"footnotes":""},"categories":[23,1593,17,624],"tags":[2582],"coauthors":[2391],"class_list":["post-34622","post","type-post","status-publish","format-standard","has-post-thumbnail","","category-business","category-metro","category-news","category-politics","tag-oil-prices"],"yoast_head":"\nOil Prices Surge By 20% On Drone Strike On Saudi Arabia - National Wire<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/nationalwire.com.ng\/sub\/oil-prices-surge-by-20-on-drone-strike-on-saudi-arabia\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Oil Prices Surge By 20% On Drone Strike On Saudi Arabia - National Wire\" \/>\n<meta property=\"og:description\" content=\"Crude oil prices have surged more than 19 per cent after a drone strike on a Saudi Arabian oil facility wiped out about five per cent of global supplies. 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