The twin attacks on the oil processing center of Abqaiq and the oil field of Khurais will certainly have an impact on oil markets this week. While Brent crude prices have been reticent to move past $60 a barrel for a year, analysts expect price movement anywhere from an additional $5 to $15 per barrel. That price movement will depend on how the Saudi government manages information flow about the attacks on its oil facilities, and how quickly it returns to full production, processing and export. Saudi Aramco President and CEO Amin Nasser promised to share a detailed assessment within 48 hours of the attack, which would time the disclosures before markets open in London and New York on Monday. As of this morning he had yet to make a public update. The transparency will matter a lot.
The attacks were able to disrupt half of Saudi oil production over the weekend, cutting 5.7 million barrels per day to global markets. By Sunday, however, Energy Intelligence reported that as much as 40% of that disrupted production (about 2.3 million barrels per day) was already restored one day after the attack. For Aramco, the state-owned oil giant, the transparency in reporting damage and the ability to regroup and respond to its customers' demands is vital to its promise to take on more shareholders. But ultimately, this attack threatens much more than a small initial public offering on the local exchange.
