WASHINGTON, Sept 17 (NNN-AGENCIES) — President Donald Trump announced that he has authorized the release of oil from US strategic reserves after drone attacks cut Saudi Arabia’s crude production by half.
“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,” Trump tweeted.
Trump announced that he ordered a release from the Strategic Petroleum Reserve (SPR), which contains over 700 million barrels.
The drone attack over the weekend — carried out by Houthi rebels from Yemen backed by Iran — reportedly crippled Saudi Arabian crude production by half.
Donald J. Trump✔@realDonaldTrump
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…
….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.
The drawdown of the U.S.’s emergency oil stocks underscored the severity of the situation, and the concerns about global supply. The SPR, which was last tapped in 2011, is an “emergency response tool” used in cases when the loss of global supply is considered disruptive to the world economy.
The unexpected attack on Abqaiq — a linchpin of Saudi Arabia’s global oil production — has rattled the markets and stoked new fears about Riyadh’s ongoing conflict with Yemen.
Meanwhile, Iran’s suspected involvement raises questions about whether the U.S. could be draw into a confrontation.
Secretary of State Mike Pompeo immediately accused Tehran of masterminding the attack, which the Iranian government denied. Via Twitter, Trump said the U.S. was “locked and loaded” for a potential response.
Donald J. Trump✔@realDonaldTrump
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!
The Saudi kingdom is one of world’s largest repositories of oil, churning out around 10 million barrels per day. It was not immediately clear how long it will take for the country to replace the supply lost by the assault on Abqaiq.
The attacks also come as Saudi Arabia’s oil company, Aramco, is preparing to float an initial public offering that could be one of the world’s largest.
Analysts say that the attack complicates the country’s IPO plans, and raises questions about the long-term security of the country’s reserves from future attacks from rebels, or Iran. — NNN-AGENCIES
