Saudi Arabia shut its largest domestic oil refinery on Monday after a drone strike, as a widening cycle of attacks across the Middle East forced precautionary shutdowns at key oil and gas facilities from Iraqi Kurdistan to offshore Israel, tightening regional supply and sending crude prices sharply higher.
State oil giant Saudi Aramco halted operations at its 550,000 barrels per day Ras Tanura refinery after two drones were intercepted at the site, Saudi authorities said. Debris from the intercepted drones caused a limited fire, the defence ministry spokesperson told Al Arabiya television, adding there were no injuries.
Saudi state news agency SPA cited an energy ministry official as saying some refinery units were shut as a precaution, but domestic supplies of fuel and petroleum products were unaffected.
Ras Tanura forms part of a major energy complex on the Gulf coast and is closely linked to one of the kingdom’s primary crude export terminals.
The escalation followed Israeli and U.S. strikes on Iranian targets and Iranian retaliation that entered a third day, prompting companies in Iraqi Kurdistan including DNO, Gulf Keystone Petroleum, Dana Gas and HKN Energy to suspend output. The region exported about 200,000 barrels per day via pipeline to Turkey’s Ceyhan port in February.
Offshore Israel, Chevron shut the Leviathan gas field on Saturday, while Energean halted production at its floating vessel serving smaller fields, curbing gas exports to Egypt.
Shipping through the Strait of Hormuz, which carries roughly a fifth of global oil consumption, slowed sharply after vessels were attacked nearby. Brent crude rose around 10% to above $82 a barrel.
Separately, Saudi Arabia’s foreign ministry summoned Iran’s ambassador to the kingdom, Alireza Enayati, on Sunday following what it described as Iranian attacks targeting Saudi Arabia and neighbouring states, according to the Saudi Press Agency. Deputy Foreign Minister Waleed Elkhereiji conveyed the kingdom’s condemnation of the attacks and warned against violations of sovereignty, saying Riyadh would take all necessary measures to defend its security and territory.
Middle East Eye also reported that Saudi officials urged Gulf Cooperation Council allies to avoid steps that could inflame tensions with Iran, as regional governments sought to prevent further escalation.
By Charles Kennedy for Oilprice.com
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