(Bloomberg) — All eyes are on how fast Saudi Arabia can restore production after this weekend’s devastating strike on key facilities, which knocked out roughly 5% of global supply and triggered a record surge in oil prices.
Significant volumes could come back within days, people familiar with the matter said over the weekend, adding that it could still take weeks to restore full capacity. Industry consultant Energy Aspects estimated in a note Sunday that the country will be able to restore almost half the lost production as early as Monday. Saudi Aramco said in a statement dated Saturday that it would provide an update in about 48 hours.
“We need to know if it’s a 48-hour outage or if it’s a four-week outage,” Ashley Peterson, a senior oil market analyst at Stratas Advisors, said on Bloomberg TV. “That’s really what’s going to drive prices.”
The estimated 5.7 million barrels a day of lost Saudi oil is the single biggest sudden disruption ever, surpassing the loss of Kuwaiti and Iraqi supply in August 1990 and Iranian output in 1979 during the Islamic Revolution, according to the International Energy Agency.
Any excuse to jack up the price of U.S. oil.
At 12+ million barrels a day, we produce more than Arabia’s 11+ million!
Oil prices hit their highest in four months after two attacks on Saudi Arabian facilities on Saturday knocked out more than 5% of global supply.
At the start of trading, Brent crude jumped 19% to $71.95 a barrel, while the other major benchmark, West Texas Intermediate, rose 15% to $63.34.
Prices eased back slightly after US President Donald Trump authorised the release of US reserves.