Saudi Arabia oil supply returns to pre-attack levels, says energy minister

Saudi Energy minister Prince Abdulaziz bin Salman Saudi Arabia would keep its role as the secure supplier of global oil markets.

:: Saudi Arabia said Tuesday its oil output will return to normal by the end of September, seeking to soothe rattled energy markets after attacks on two instillations that slashed its production by half.

Prince Abdulaziz bin Salman told a press conference in Jeddah that half of the production knocked out by the attacks was already back up and running. He said the Kingdom had dipped into its stored reserves to ensure supply continued as normal.

“Over the past two days we have contained the damage and restored more than half of the production that was down as a result of the terrorist attack,” said the minister.

“I have good news for you… the oil output to international markets is back to what it was before the attack,” he said.

The Prince said Saudi Arabia would keep its role as the secure supplier of global oil markets. He added that the Kingdom, the world’s leading oil exporter, needs to take strict measures to prevent further attacks.

“Where would you find a company in this whole world that went through such a devastating attack and came out like a phoenix?” he said

Oil prices dropped about six percent Tuesday after the energy minister’s comments, steadying markets that had jumped amid concerns of supply and instability in the region.

The attacks on Saturday on the Abqaiq processing plant and Khurais oil field halved the Kingdom’s production and shut off about five percent of global oil output.

The Kingdom will achieve 11 million barrels per day (bpd) capacity by the end of September and 12 million bpd by the end of November, Prince Abdulaziz.

Oil production in October would be 9.89 million bpd and the world’s top oil exporter would keep full oil supplies to customers this month, he said.

“We don’t know who is behind the attack,” Prince Abdulaziz said, adding that the kingdom wants “proof based on professionalism and internationally recognised standards.”

The US has blamed Iran for the attack and sent Secretary of State Mike Pompeo to Saudi Arabia amid heightened tensions.

Saudi Arabia’s defense ministry is to present evidence on Wednesday of Iranian involvement, as well as weapons used, in the attacks.

Aramco chairman Yasir Al-Rumayyan said the attacks would not effect the upcoming IPO of his company.

Chief Executive Amin Nasser said the company was still in the process of estimating repair work but that it was “not that significant.”

“We had to deal with an unprecedented attack,” he said. “We had to tackle 10 fires raging simultaneously — three in Khurais and seven in Abqaiq. It took us less than seven hours to put these fires out, which is amazing considering that we were dealing with hydrocarbons, gas and oil.”

He added that production at Khurais resumed only 24 hours after the attack and has gradually increased since then. Production at Abqaiq is at 2 million bpd, with output expected to be restored to prior levels by the end of September.

“These synchronized attacks were timed to create maximum damage to our facilities and operations,” said Nasser. “The rapid response and resilience demonstrated in the face of such adversity shows the company’s preparedness to deal with threats aimed at sabotaging Aramco’s supply of energy to the world.”

Praising the efforts of emergency-response teams, including firefighters and operations and security personnel, in coordination with government agencies, he added: “I am enormously proud of the courage, dedication and proficiency of our people, who ensured there were no injuries. We have a hard-earned reputation for nearly 100 percent reliability in terms of meeting our international customers’ requirements and we have defended that.”

Aramco ensured deliveries would continue by drawing on inventories and offering additional crude production from other fields.

“Not a single shipment to an international customer has been or will be missed or canceled as a result of these attacks,” said Nasser. “We have proven that we are operationally resilient and have confirmed our reputation as the world’s leading supplier.”

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