The world is once again gripped by stresses between the two big powers of the region- Saudi Arabia and Iran. A drone strike targeted Saudi Arabia’s oil storage facilities. This drone attack reduced its oil production by 5.7 million barrels a day.
After the drone attack fears of an escalation in armed conflict Saudi Arabia & Iran. The situation has created huge challenges for India. After the attack Crude oil has not only become costly but stocks for Indian refineries have also become doubtful.
India is making diplomatic efforts to limit the damage. The central Govt of India has spoken to several oil supplier countries to ensure additional supplies.
Saudi Arabia Oid Fields Targeted
Half of Saudi Arabia’s oil production hit by the drone attack last week.
The attack cut 5.7 million barrels per day of Saudi crude output. Which
Accounts for over 5% of the world’s supply. Saudi Arabia’s emergency oil reserve also targeted. Saudi only major oil-producing nation with significant oil reserve.
Oil Prices Hit Record High on 16 Sept
Brent Crude jumped nearly 20% which is highest ever surge in the past 30 years. According to the expert, Oil prices could keep rising if damages not repaired. Saudi Aramco aims to restore oil production by September end. Output capacity back to 12 million BPD by November end.
Saudi Arabia left with no oil reserves. International Energy Agency asks countries to manage oil reserves for at least 90 days. Saudi Arabia is India’s second-largest oil supplier. India imports almost 80% of oil from Saudi Arabia. India consumed total 211.6 million tones oil in 2018-19.