Trump’s Latest Tweetstorm Rages Over Saudi Oil Attack
Oil prices have been soaring Monday after a drone attack at Saudi Aramco’s Khurais oil field in Buqyaq, Saudi Arabia, forced the Kingdom to shut down over half of its daily production capacity.
Yemen’s Houthi rebels claim attacks on 2 Saudi Aramco oil facilities, Saudi Arabia’s state-owned oil giant, disrupting oil output and exports.
Read more: https://t.co/yxsjB6k6WS pic.twitter.com/60gvBJk2yP
— Al Jazeera English (@AJEnglish) September 15, 2019
The oil attack on the Saudi facility has left Donald Trump enraged, who went on an early Monday morning tweetstorm and threatened action against the culprits.
Saudi Arabia oil supply was attacked. There is reason to believe that we know the culprit, are locked and loaded depending on verification, but are waiting to hear from the Kingdom as to who they believe was the cause of this attack, and under what terms we would proceed!
— Donald J. Trump (@realDonaldTrump) September 15, 2019
Who is Responsible for the Saudi Oil Attack?
The Telegraph reports that Yemen’s Iran-backed Houthi rebels are claiming responsibility for the drone strikes that have wiped off 5.7 million barrels per day of crude oil production. This amounts to 5% of the global daily production capacity.
But U.S. Secretary of State Mike Pompeo has accused Iran of being directly involved in the Saudi oil attack.
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.
— Secretary Pompeo (@SecPompeo) September 14, 2019
President Trump, on the other hand, has adopted a more measured approach and is waiting for confirmation from Saudi Arabia over the attacks before taking any further step. Iran, however, says that the allegations against its involvement in the Saudi oil attack are baseless.
Iran rejects ‘baseless’ accusations it had role in Saudi oil attacks https://t.co/wAZgEuMeuI pic.twitter.com/eY0jVEnng9
— Reuters Top News (@Reuters) September 16, 2019
But officials in the Trump administration are of the opinion that Iran is lying.
Iran launched nearly a dozen cruise missiles and over 20 drones from its territory in the attack on a key Saudi oil facility, a senior Trump administration official told @ABC News. https://t.co/L4lEZRIx0M
— ABC News (@ABC) September 16, 2019
ABC News quoted a senior Trump administration official saying:
It was Iran. The Houthis are claiming credit for something they did not do.
However, the Iran-backed rebel group is claiming that its drones are potent enough to “reach anywhere in Saudi Arabia,” which indicates that more oil installations in the country might be under threat.
BREAKING — Yemen’s Houthi rebels said oil installations in Saudi Arabia remain among their targets.
The Iranian-backed group said its weapons can reach anywhere in Saudi Arabia. Saturday’s attacks were carried out by “planes” using new engines, the group said
— Bloomberg
— Ragıp Soylu (@ragipsoylu) September 16, 2019
And the Houthis might not be bluffing. The rebels’ drones reportedly have a range of 1,500 kilometers, so they were capable enough to carry out the attacks on Saudi oil facilities. According to reports, the drones needed to cover a distance of at least 950 kilometers from their base in Yemen to carry out the strike, which was well within their flying range.
To carry out the attacks on Saudi oil facilities, Houthi drones had to uninterruptedly travel more than 950 km from the rebel-held area in Yemenhttps://t.co/IppLmgr1qh pic.twitter.com/uayYFMTFRQ
— DAILY SABAH (@DailySabah) September 16, 2019
Immediate Focus Is Maintaining Oil Supply and Keeping Prices Stable
While Donald Trump seems to have a finger on the trigger already in response to the attacks on Saudi oil installations, the U.S. president is also focused on restoring the balance in the oil market. To keep oil prices from shooting higher, Trump has decided to authorize the release of oil from the U.S.’ strategic reserve.
Based on the attack on Saudi Arabia, which may have an impact on oil prices, I have authorized the release of oil from the Strategic Petroleum Reserve, if needed, in a to-be-determined amount….
— Donald J. Trump (@realDonaldTrump) September 15, 2019
….sufficient to keep the markets well-supplied. I have also informed all appropriate agencies to expedite approvals of the oil pipelines currently in the permitting process in Texas and various other States.
— Donald J. Trump (@realDonaldTrump) September 15, 2019
Secretary Pompeo has also toed the line of President Trump and said that the U.S. and its allies will work to restore oil supply.
We call on all nations to publicly and unequivocally condemn Iran’s attacks. The United States will work with our partners and allies to ensure that energy markets remain well supplied and Iran is held accountable for its aggression
— Secretary Pompeo (@SecPompeo) September 14, 2019
Saudi Arabia, on the other hand, is reportedly in a rush to restore its oil production and get its capacity back online after the attack.
Saudi Arabia is racing to restore oil production after drone attacks destroyed half of its capacity or 5% of the global supply pic.twitter.com/9fzJQLtm39
— Bloomberg TicToc (@tictoc) September 15, 2019
Increasing oil supply will be essential to keeping prices in check. The price of West Texas Intermediate (WTI) crude oil has shot up to nearly $60 per barrel post the attacks, while Brent crude is trading around $65.
The price of refined oil products such as gasoline and heating oil has also spiked in the high-single digits following the attacks. So, it is not surprising to see why Trump and U.S. allies are scrambling to boost oil supply, given that a high pricing scenario will hurt consumer spending and accelerate the chances of a recession, according to an analyst at S&P Global Platts.
This is something that Trump cannot afford right now as his trade war with China is already a sore point for the stock market, and consumers are already on the brink as the slowdown in the U.S. housing market shows.
Last modified (UTC): September 16, 2019 12:44 PM
Published at Mon, 16 Sep 2019 15:04:00 +0000
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