Brent Oil Price Reaches $70 After Saudi Attack

Brent Oil prices sprang up past USD 70 per barrel for the first time in over a year after an attack on a Saudi petroleum storage tank and a residential compound on Sunday, although no one was injured and there wasn’t any property damage. Brent Oil (EB) prices were up by 1.7% over the weekend.

Saudi Arabia’s proxy war with Iran may be heating up as a drone attack on Sunday morning hit an Oil facility in Ras Tanura, one of the world’s largest shipping ports. A separate missile attack on Sunday evening was aimed at a residential compound in Dhahran, Saudi Arabia, where the country’s state Oil company Aramco is headquartered. 

Neither attack resulted in property damage or injury. While production was not impacted, the attacks may have unsettled commodity traders in light of an escalation of fighting by Iran-backed groups in Saudi Arabia and Syria. The new Biden administration also carried out airstrikes in Syria against militia groups affiliated with Iran in February.

Sunday’s attack was the most serious offensive against a Saudi facility since September 2019, when Yemenite Houthi rebels knocked out production to the Khurais Oil field and the Abqaiq processing facility for several days.

OPEC+ Extends Production Cap Through April

Crude Oil (CL) prices had already begun to rise after OPEC+ surprised market expectations on Thursday and kept a 7 million barrel per day reduction in place. In particular, Saudi Arabia agreed to continue its voluntary cut of 1 million barrels for an extra month. The move caused several investment banks to raise their Oil price targets. Oil was trading up by 3.5% after Friday’s close.

As hostilities between the Houthis and Saudi Arabia heat up, traders may wish to keep an eye out for future attacks that could result in further price hikes.