Oil posted its biggest ever intraday jump, briefly surging above US$71 a barrel after a strike on a Saudi Arabian oil facility removed about 5 per cent of global supplies and raised the specter of more destabilization in the region.
“We have never seen a supply disruption and price response like this in the oil market,” said Saul Kavonic, an energy analyst at Credit Suisse Group AG. “Political-risk premiums are now back on the oil-market agenda.” The disruption surpasses the loss of Kuwaiti and Iraqi petroleum output in August 1990, when Saddam Hussein invaded his neighbor. It also exceeds the loss of Iranian oil production in 1979 during the Islamic Revolution, according to the International Energy Agency.
That would rattle oil markets further and cast a shadow on Aramco’s preparations for what could be the world’s biggest initial public offering. It’s also set to escalate a showdown pitting Saudi Arabia and the U.S. against Iran, which backs proxy groups in Yemen, Syria and Lebanon. Iran-backed Houthi rebels in Yemen claimed credit for the attack, but U.S. President Donald Trump and Secretary of State Mike Pompeo have already pointed the finger directly at Iran.
Brent jumped more than 19 per cent to US$71.95 a barrel on ICE Futures Europe, its biggest gain in percentage terms since 1991. In the ensuing hours, it pared that advance to trade up 9.5 per cent at US$65.92 a barrel as of 10:25 a.m. in London. The global benchmark crude could rise above US$75 a barrel if the outage at Abqaiq lasts more than six weeks, Goldman Sachs Group Inc. said.
Doesn’t matter, I only tank $10.00 at a time.
This will impact Canada if the price of fuel goes up. WeWantAlbertaOil TrudeauMustGo
So much for reducing carbon emissions. What tonnage of GHG is actually being released from this fire?
According to the plan.... all other speculations didn’t work.....
Trump has better listen to his advisors here. Iran would love nothing more than to have a couple of Yemini wedding parties blown up.