Saudis cut oil and gas production by half after drone attacks, global prices to be hit adversely

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Saudi Arabia said on Saturday he that it had decided to cut down the oil production at the Aramco facilities by 5.7 million barrels per day following the drone attacks by Houthi rebels on oil facilities at Abqaiq and Khurais plants. This is almost half of the oil produced by the Saudi kingdom.

A press note by the government-owned Saudi Press Agency said, “Saudi Aramco’s emergency response teams successfully responded to fires at their plants in Abqaiq and Khurais resulting from terrorist projectile attacks. It was able to put out the fires that resulted from this terrorist act, which had a direct impact on production cuts by 5.7 million barrels per day.”

Saudi Aramco Chairman and Chief Executive Officer Eng. Amin Hassan Al-Nasser said that the drone attacks had resulted in ‘no injuries among the staff.’

Energy Minister Prince Abdulaziz bin Salman said that the reduction in oil output will be compensated by drawing on Aramco’s oil stocks.

A Yemeni Houthi rebel spokesman had claimed responsibility for deploying 10 drones in the attacks. However, US Secretary of State Mike Pompeo blamed the attacks on Iran saying that there was no evidence they came from Yemen.

Pompeo took to Twitter to write, “Tehran is behind nearly 100 attacks on Saudi Arabia while Rouhani and Zarif pretend to engage in diplomacy. Amid all the calls for de-escalation, Iran has now launched an unprecedented attack on the world’s energy supply. There is no evidence the attacks came from Yemen.”

The Saudis have been heading a Western-backed military coalition that support the Yemen’s government, while Iran backs the Houthi rebels.

Yahya Sarea, a spokesperson for the Houthi group, had told al-Masirah TV, which is owned by the Houthi movement and is based in Beirut, that further attacks could be expected in the future. He threatened further attacks on the kingdom unless Saudi Arabia ends the war in Yemen.

Saudi produces 10% of global crude oil while the two facilities owned by Aramco alone produce 8% of the global supply. Analysts say that the Saudi government’s decision to cut down the oil production by 5.7 million barrels per day will adversely impact the oil prices across the world including India.

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