Sunday, September 15, 2019
Oil prices soar after attacks on Saudi facilities
Oil prices hit their highest in four months after two attacks on Saudi Arabian facilities which has knocked out 5% of global supply. At the start of trading, Brent crude jumped 19% to $71.95 a barrel, while the other major benchmark, West Texas Intermediate, rose 15% to $63.34.Prices eased back slightly after US President Donald Trump authorized the release of US reserves. State oil giant Saudi Aramco said that the attack cut output by 5.7 million barrels per day. The drone attacks on plants in the heartland of Saudi Arabia's oil industry included hitting the world's biggest petroleum-processing facility.US Secretary of State Mike Pompeo said Tehran was behind the attacks. Iran accused the US of "deceit."Later Mr Trump said in a tweet the US knew who the culprit was and was "locked and loaded" but waiting to hear from the Saudis about how they wanted to proceed. What will be effects on global supply due to such attacks? Will President Trump intervene and reinstate economic sanctions on Iran?
https://www.bbc.com/news/business-49710820
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I think the global supply of crude oil will recover quite quickly and the price will steadily drop over time back to what it was prior to the attacks. Im hearing on social media and other news platforms that this may have been setup because oil producers were fearful that crude oil was going to have a major selloff soon. Though I don't believe these rumors based off people's speculation, but it just makes you think.
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