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Saudi Arabia says oil output to be restored by end of September
JEDDAH, Saudi Arabia, Sept 18, 2019 (BSS/AFP) – 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.
The weekend strikes on Abqaiq — the world’s largest oil processing
facility — and the Khurais oil field in eastern Saudi Arabia roiled energy
markets and revived fears of a conflict in the tinderbox Gulf region.
Energy Minister Prince Abdulaziz bin Salman, who was only appointed to the
role earlier this month, said that the world’s top energy exporter had dipped
into its strategic reserves to maintain supply to clients.
“I have good news for you… the oil output to international markets is
back to what it was before the attack,” he told reporters in the western Red
Sea city of Jeddah.
“During the past two days the damage was contained and 50 percent of the
production has been recovered,” he added. “Production will be back to normal
by the end of September.”
Prince Abdulaziz said the kingdom would achieve 11 million barrels per day
(bpd) capacity by the end of September and 12 million bpd by the end of
November.
“Restoring sustainable production capacity to 11 million bpd by the end of
the month is an ambitious target, given the amount of repairs required” at
the sites, Alex Schindelar, president of the Energy Intelligence group, told
AFP.
The extent of the damage at the plants remains unclear and Energy
Intelligence has said that some of the repair work could take “several
weeks”.
– ‘Aramco delivers’ –
But Saudi officials were also bullish on plans for the mega stock listing
of oil giant Aramco, which was thought to be imperilled by the attack.
“The IPO will continue as is, we won’t stop anything,” said Aramco chairman
Yasir al-Rumayyan.
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He said the IPO would take place “within the next 12 months” depending on
market conditions.
The energy giant’s CEO, Amin Nasser, dismissed the suggestion it had taken
a big reputational hit with the strikes, which observers have said exposed
the vulnerabilities of Saudi infrastructure.
“We are the most reliable company. When there is a crisis Aramco delivers,”
he told reporters
“Actually the rest of the world should be amazed at what happened. In terms
of no customers were interrupted, and production was put back on in a short
time.”
The mammoth IPO forms the cornerstone of a reform programme envisaged by de
facto ruler Crown Prince Mohammed bin Salman to wean the Saudi economy off
its reliance on oil.
Saudi Arabia’s energy infrastructure has been hit before, but Saturday’s
attack was of a different scale, abruptly halting half the OPEC kingpin’s
output — some six percent of the world’s oil supply.
As the US points the finger of blame at Saudi Arabia’s regional rival Iran,
Prince Abdulaziz — half-brother to Prince Mohammed — refused to be drawn on
who was responsible for the strikes.
“We don’t know who is behind the attack,” he said, adding that the kingdom
wants “proof based on professionalism and internationally recognised
standards”.
Washington has concluded that the attacks were launched from Iranian soil
and that cruise missiles were involved, a US official told AFP on Tuesday.
The official, who declined to be identified, said the United States was
gathering evidence about the attack to present to the international
community, notably European allies, at the UN General Assembly next week.
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