Pompeo accuses Iran of ‘unprecedented attack’ after drones hit Saudi oil facilities

Comment by Jim Campbell

September 15th, 2019

Imagine if you will the far left in our country attempting to deal with this mega-problem potentially affecting the entire industrial world and coming from seemingly three directions at the same time.

Are the attacks coming from Iran? Probably.

Iran has admitted supporting the Houthis rebels attack on the Saudis. (Source)

What part is China playing and who is it financially supporting?

A weekend drone attack on Saudi Arabia that halved the kingdom’s oil production is now threatening to fuel regional tensions.

The Associated Press

This Saturday, Sept. 14, 2019, satellite image from Planet Labs Inc. shows thick black smoke rising from Saudi Aramco’s Abqaiq oil processing facility in Buqyaq, Saudi Arabia.

Yemen’s Houthi rebels launched drone attacks on the world’s largest oil processing facility in Saudi Arabia and a major oil field Saturday, sparking huge fires and halting about half of the supplies from the world’s largest exporter of oil. (Planet Labs Inc via AP)

By JON GAMBRELL, Associated Press

DUBAI, United Arab Emirates (AP) — A weekend drone attack on Saudi Arabia that cut into global energy supplies and halved the kingdom’s oil production threatened Sunday to fuel regional tensions, as Iran denied U.S. allegations it launched the assault and tensions remained high over Tehran’s collapsing nuclear deal with world powers.

Iran called the U.S. claims “maximum lies,” while a commander in its paramilitary Revolutionary Guard reiterated its forces could strike U.S. military bases across the Mideast with its arsenal of ballistic missiles. A prominent U.S. senator suggested striking Iranian oil refineries in response for the assault claimed by Yemen’s Iran-backed Houthi rebels on Saudi Arabia’s largest oil processing facility.

“Because of the tension and sensitive situation, our region is like a powder keg,” warned Guard Brig. Gen. Amir Ali Hajizadeh. “When these contacts come too close, when forces come into contact with one another, it is possible a conflict happens because of a misunderstanding.”

Actions on any side could break into the open a twilight war that’s been raging just below the surface of the wider Persian Gulf over the last months. Already, there’s been mysterious attacks on oil tankers that America blames on Tehran, at least one suspected Israeli strike on Shiite forces in Iraq, and Iran shooting down a U.S. military surveillance drone.

The attack Saturday on Saudi Arabia’s Abqaiq plant and its Khurais oil field led to the interruption of an estimated 5.7 million barrels of the kingdom’s crude oil production per day, equivalent to over 5% of the world’s daily supply.

It remains unclear how King Salman and his assertive son, Crown Prince Mohammed bin Salman, will respond to an attack targeting what analysts describe as the heart of the Saudi oil industry.

The technological sophistication and audacity of Saturday’s attack will linger over the energy market.

Smoke billowed from an Aramco oil facility in Abqaiq, in Saudi Arabia’s eastern province, where drone attacks sparked fires Saturday.Photo:-/Agence France-Presse/Getty Images

The Wall Street Journal

By Spencer Jakab

Sept. 15, 2019

Saturday’s attack on a critical Saudi oil facility will almost certainly rock the world energy market in the short term, but it also carries disturbing long-term implications.

Ever since the dual 1970s oil crises, energy security officials have fretted about a deliberate strike on one of the critical choke points of energy production and transport.

Sea lanes such as the Strait of Hormuz usually feature in such speculation. The facility in question at Abqaiq is perhaps more critical and vulnerable. The Wall Street Journal reported that 5.7 million barrels a day of output, or some 5% of world supply, had been taken offline as a result.

To illustrate the importance of Abqaiq in the oil market’s consciousness, an unsuccessful terrorist attack in 2006 using explosive-laden vehicles sent oil prices more than $2.00 a barrel higher.

Saudi Arabia is known to spend billions of dollars annually protecting ports, pipelines and processing facilities, and it is the only major oil producer to maintain some spare output.

Yet the nature of the attack, which Iranian-supported Houthi fighters from Yemen claimed was the result of a drone attack by their forces, shows that protecting such facilities may be far more difficult today.

U.S. officials blamed Iran and U.S. and Saudi officials were investigating the possibility that another Iranian-backed group carried out all or part of the attack using cruise missiles launched from Iraq. Iranian officials on Sunday denied responsibility for the attacks.

There are countries that even today see their output ebb and flow as a result of militant activity, most notably Nigeria and Libya.

Others, such as Venezuela, are in chronic decline due to political turmoil. Such news affects the oil price at the margin but is hardly shocking.

Deliberate attacks by actual military forces have been far rarer, with the exception of the 1980s “Tanker War” involving Iraq, Iran and the vessels of other regional producers such as Kuwait.

When Saddam Hussein’s Iraqi forces invaded Kuwait in 1990, removing its production from the market and putting Saudi Arabia’s massive crude output under threat, prices more than doubled over two months.

Yet Saturday’s attack could be more significant than that.

Technology from drones to cyberattacks are available to groups like the Houthis, possibly with support from Saudi Arabia’s regional rival Iran.

That major energy producer, facing sanctions but still shipping some oil, has both a political and financial incentive to weaken Saudi Arabia.

The fact that the actions ostensibly were taken by a nonstate actor, though, limits the response that the U.S. or Saudi Arabia can take.

Attempting to further punish Iran is a double-edged sword, given that pinching its main source of revenue, also oil, would further inflame prices.

While the redundancies in Saudi oil infrastructure mean that output may be restored as soon as Monday, the attack could build in a premium to oil prices that has long been absent due to complacency.

Indeed, traders may now need to factor in new risks that threaten to take not hundreds of thousands but millions of barrels off the market at a time.

U.S. shale production may have upended the world energy market with nimble output, but the market’s reaction time is several months, not days or weeks, and nowhere near enough to replace several million barrels.

After the smoke clears and markets calm down, the technological sophistication and audacity of Saturday’s attack will linger over the energy market.

THE END

About JCscuba

I am firmly devoted to bringing you the truth and the stories that the mainstream media ignores. Together we can restore our constitutional republic to what the founding fathers envisioned and fight back against the progressive movement. Obama nearly destroyed our country economically, militarily coupled with his racism he set us further on the march to becoming a Socialist State. Now it's up to President Trump to restore America to prominence. Republicans who refuse to go along with most of his agenda RINOs must be forced to walk the plank, they are RINOs and little else.
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2 Responses to Pompeo accuses Iran of ‘unprecedented attack’ after drones hit Saudi oil facilities

  1. JAFC says:

    As America (and to a great extent Canada and Mexico) have now achieved “fossil fuel” independence, one is prone to humorous speculation about the future windmill-driven cars and factories of western Europe.

    As to Handicapping the upcoming war around the corner, the Ayatollahs have the huge army and the Saudis have the better air force. After all these years of separating U-238 and U-235, Iran obviously has a nuclear arsenal salted away in its mountains. Their neighbors must be stocking up on Depends, if you get my drift.

    Like

    • JCscuba says:

      U R Funny, I’ll take the Saudi’s with out their airforce and the U.S. will blow Iran off the map if this is anything more than propaganda. Thanks, Jim

      Like

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