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Date TimeSeptember 15, 2019
VoiceIran has dismissed claims it was behind drone attacks on Saudi oil plants on Saturday but warned the United States it is ready for “full-fledged” war.
Iran Warns US It Is Ready For Full-Fledged War As Gulf Tensions Escalate Further
Yemen’s Houthi group claimed responsibility for the strikes that knocked out more than half of Saudi oil output or more than 5% of global supply, but US Secretary of State Mike Pompeo later said the assault was the work of Iran, a Houthi ally.
Iranian foreign ministry spokesman Abbas Mousavi dismissed the US allegation as “pointless”. A senior Revolutionary Guards commander warned that the Islamic Republic was ready for “full-fledged” war, Reuters reports.
“All American bases and their aircraft carriers in a distance of up to 2,000 kilometers around Iran are within the range of our missiles,” the semi-official Tasnim news agency quoted commander Amirali Hajizadeh as saying.
State oil giant Saudi Aramco said the attack cut output by 5.7 million barrels per day, at a time when Aramco is trying to ready itself for what is expected to be the world’s largest share sale.
The drone strikes on plants in the heartland of Saudi Arabia’s oil industry, including the world’s biggest petroleum processing facility, were expected to send oil prices up $5-10 per barrel on Monday as tensions rise in the Middle East.Aramco gave no timeline for output resumption. A source close to the matter told Reuters the return to full oil capacity could take “weeks, not days”.
Traders and analysts said crude may spike to as high as $100 if Riyadh fails to quickly bring back supply.
The kingdom, the world’s top oil exporter, ships more than 7 million barrels of oil to global destinations every day.
Riyadh said it would compensate for the loss by drawing on its stocks which stood at 188 million barrels in June, according to official data. The United States said it was also ready to tap emergency oil reserves if needed.
The Saudi bourse closed down 1.1% with banking and petrochemical shares taking the biggest hit. Saudi petrochemical firms announced a significant reduction in feedstock supplies.
“Abqaiq is the nerve centre of the Saudi energy system. Even if exports resume in the next 24-48 hours, the image of invulnerability has been altered,” Helima Croft, global head of commodity strategy at RBC Capital Markets, told Reuters.
According to US government information, 15 structures at Abqaiq suffered damage on their west-northwest facing sides.
Pompeo said there was no evidence the attack came from Yemen, where a Saudi-led coalition has been battling the Houthis for over four years in a conflict widely seen as a proxy war between Saudi Arabia and Shi’ite Muslim rival Iran.
“Amid all the calls for de-escalation, Iran has now launched an unprecedented attack on the world’s energy supply,” he said.
Some Iraqi media outlets said the attack came from there. Baghdad denied this on Sunday and vowed to punish anyone using Iraq, where Iran-backed paramilitary groups wield increasing power, as a launchpad for attacks.
Kuwait, which borders Iraq, said it was investigating the sighting of a drone over its territory and coordinating with Saudi Arabia and other countries. The cabinet said the prime minister ordered tighter security at vital installations.
Riyadh accused Iran of being behind previous attacks on oil pumping stations and the Shaybah oilfield, charges Tehran denies. It has not yet blamed any party for Saturday’s strike, but linked it to a recent series of attacks on Saudi oil assets and crude tankers in Gulf waters.
Riyadh says Iran arms the Houthis, a charge both deny.
Regional tensions have escalated since Washington quit an international nuclear deal and extended sanctions on Iran.
The European Union warned that Saturday’s attack posed a real threat to regional security, Britain called it a “reckless attempt” to disrupt global oil supplies and France said such actions could only worsen “risk of conflict”. Iran’s ally Turkey called for the avoidance of “provocative steps”.Related... Two British-Australian Women Among Three 'Detained In Iran' Trump Fires John Bolton, Says He's 'No Longer Needed' At White House

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