RTSun, 15 Sep 2019 09:58 UTC
© Stringer/ReutersSmoke is seen following a fire at an Aramco factory in Abqaiq, Saudi Arabia, Sept. 14, 2019.
Iran has rebuffed US accusations of launching a drone attacks that cut Saudi Arabia's oil output in half. A senior Islamic Revolutionary Guard Corps commander, meanwhile, has warned Washington that
Tehran is ready for war.Allegations that Iran was behind the drone attacks on Saudi oil facilities are "unsubstantiated" and false, Foreign Ministry spokesperson Seyyed Abbas Mousavi stated on Sunday. He also said officials in Washington are accusing Iran in order to tarnish its image on the world stage in preparation for "future actions" against Tehran.
"The Americans adopted the 'maximum pressure' policy against Iran, which, due to its failure, is leaning towards 'maximum lies'."The Houthi rebels in Yemen have claimed responsibility for sending 10 armed drones to hit two Saudi oil refineries on Saturday. The attacks caused massive fires and other damage to the sites, which halved the kingdom's oil output.
The Houthis previously admitted to launching similar drone and rocket attacks against Riyadh, some of which were directed at oil pumping stations. The Saudis have been waging a devastating aerial bombing campaign in civil war-torn Yemen, where they intervened in 2015 on behalf of ousted President Abdrabbuh Mansur Hadi.
US Secretary of State Mike Pompeo, however, squarely blamed Iran. Senator Lindsey Graham even suggested the US should respond by striking Tehran's oil refineries.The commander of the Islamic Revolutionary Guard Corps (IRGC) Aerospace Force, Brigadier General Amir Ali Hajizadeh, warned that Tehran is fully prepared to retaliate if attacked.
"Everybody should know that all American bases and their vessels in a distance of up to 2,000 kilometers [from Iran] are within the range of our missiles."
Comment: Sputnik, 15/9/2019: IRGC General: 'Ready for War - two US bases, warship within range of Iran's missiles
Tehran has always been prepared for a full-fledged war, Iran's Revolutionary Guards Corps Aerospace Force Chief Amirali Hajizadeh said in a statement on Sunday.
"Everybody should know that all American bases and their aircraft carriers, at a distance of up to 2,000 kilometres around Iran, are within the range of our missiles," Hajizadeh said. "Al-Udeid base in Qatar, az-Zafra base in the UAE and a US vessel in the Gulf of Oman would be targeted if Washington took military action," the commander said.
Global Community Condemns Drone Attacks on Saudi Arabia
US Senator Lindsey Graham accused the Islamic Republic of looking to "wreak havoc in the Middle East", and recommend that the US "put on the table an attack on Iranian oil refineries if they continue their provocations".
Moreover, US Secretary of State Mike Pompeo pinned the blame on Tehran over the attacks calling for public condemnation of Iran's actions.
Saudi Crown Prince Mohammed bin Salman told Trump during the phone call that the kingdom was willing and able to confront and deal with this "terrorist aggression."
The French Foreign Ministry also decried the attacks on Saudi oil facilities, expressing "full solidarity" with Riyadh. "These actions can only worsen regional tensions and risk of conflict," the ministry said. "It is imperative that they stop."
Drone Attacks on Saudi Oilfields
On Saturday, two drone attacks, claimed by Houthis, caused major fires in two oil facilities: in Abqaiq in eastern Saudia Arabia and Khurais northeast of Riyadh. These were eventually contained by security and emergency service personnel. According to the Saudi energy minister, Prince Abdulaziz bin Salman, oil production at the two plants has temporarily stopped, interrupting about half of the company's total daily oil output.
Sputnik, 15/9/2019: Iraq denies drones attacking Saudi oil facilities were launched from Iraq
Iraq has denied media reports claiming that its territory was used to launch the drones that attacked Saudi Arabia's oil facilities on Saturday night, a statement from the Iraqi Prime Minister's press-service released on Twitter says.
It also says that the constitution of Iraq does not allow the use of its territory for aggressive actions towards its neighbours. The Iraqi authorities have set up a committee to monitor reports and the latest events relating to the drone attack on Saudi Arabia's oil facilities.
Iraq also urges the warring sides in Yemen to find a peaceful solution to the conflict and refrain from "mutual attacks that cause a huge damage to facilities and claim people's lives," according to the statement.
Sputnik, 15/9/2019: Saudi attack may nudge US to 'go to war' with Iran
The United States will emerge as the "biggest beneficiary" of Saturday's drone attacks that targeted a Saudi Aramco processing facility and oilfield in eastern Saudi Arabia, internet tycoon Kim Dotcom has suggested.
The attacks are expected to trigger a jump in oil prices when markets reopen on Monday, given that Saudi Arabia has halted half its oil production - around five million barrels of crude per day, or around 5 percent of the world's daily output.
The millionaire Megaupload founder...predicted the attacks would embolden the US - the largest oil producer - to "blame Iran, go to war, [and] take control of Iran's oil which pays for the war."
This scenario has partly come to pass already: although Yemen's Houthi rebels acknowledged they were behind the strikes, US Secretary of State Mike Pompeo claimed there was "no evidence" to believe the attacks came from Yemen and blamed Iran instead.
Iran's Foreign Minister Mohammad Javad Zarif denied any involvement and hit back by saying America's "maximum pressure" policy turned to "max deceit."
US senator Lindsey Graham, a leading Trump ally, has called on the government to consider attacking Iranian oil refineries in response.
The Houthis, who are at war with the Saudi-led coalition in Yemen, already claimed responsibility for a drone attack on a major Saudi pipeline in May. Back then, Saudi officials accused Iran of ordering the strike, but Tehran rejected their claims.
This "maximum pressure" campaign is being mounted at a time when the Middle East appears to be embracing a new geopolitical reality, where Saudi Arabia and other Gulf nations such as the UAE and Oman are becoming increasingly closer to the United States and Israel over fears of growing Iranian influence in the region.
Riyadh, along with a number of Western states, accuses Tehran of arming the Houthi rebels. "For 40 years, the Iranian regime has been spreading chaos, death and destruction, by sponsoring and financing terrorist organizations including the Houthis," Saudi Arabia's deputy defence minister, Prince Khalid bin Salman, said in June.
Iran has acknowledged its ideological support for fellow Shiite Houthi insurgents, although it dismisses charges of providing the militants with weapons.
Sputnik, 15/9/2019: Zarif: US will not end war in Yemen by blaming Iran for everything
Iranian Foreign Minister Mohammad Javad Zarif said on Sunday that the United States would not be able to stop the war in Yemen by blaming Iran for everything.
The fires, in particular, hit the Abqaiq oil refinery in Eastern Province, and an oil-processing facility near Khurais oil field, located about 100 miles east of Riyadh.
RT, 15/9/2019: Massive heart attack for oil market? Drone raid may push oil to $100
The drone strike on major Saudi Arabian oil sites, including the world's largest oil processing facility, could add a significant risk premium to the price of crude oil, as the attack cut the kingdom's output in half.
Armed drones targeted a refinery in the city of Abqaiq, the crown jewel of the Saudi oil infrastructure, which is crucial for global energy supplies, and a refinery at the vast Khurais oil field. The attack, claimed by Yemen's Houthi rebels, seriously damaged the kingdom's production capacity, affecting more than 5 million barrels of crude processing per day.
Despite assurances from the International Energy Agency (IEA) that the global oil markets are "well supplied," and oil giant Saudi Aramco saying it can restore production, this major disruption in the world's leading oil exporting state is poised to send oil prices soaring when trading reopens late Sunday, analysts believe.
The gloomiest scenario includes crude prices in triple digits. If the shortage persists for a long time, oil is feared to rise to $100, according to Forbes and some industry experts. Moreover, the already slow global growth may suffer even more.
The attack on the Saudi oil facilities is "akin to a massive heart attack for the oil market and global economy," according to former top energy and economic adviser to President George W. Bush, Bob McNally. His concerns were echoed by a veteran OPEC watcher at consultant IHS Markit, Roger Diwan.
"Abqaiq is the heart of the system and they just had a heart attack," Diwan told Bloomberg.
While many agree that the oil market cannot ignore the attack in Abqaiq, how much the price of oil will spike is still a big question. Andrew Lipow of Lipow Oil Associates expects that oil will jump in the range of $5 to $10 per barrel, adding up to 25 cents per gallon for gasoline, according to CNBC.
Washington says it is ready to step in and offset any possible disruptions. On Saturday, the Department of Energy said the US can deploy resources from the Strategic Petroleum Oil Reserve, which holds nearly 645 million barrels of oil.
RT, 15/9/2019: Saudi stocks slump after drone strikes hit Aramco oil plants
© Reuters/Faisal Al NasserInvestor at the Saudi Stock Exchange (Tadawul) in Riyadh
The Saudi Stock Exchange (Tadawul) started Sunday's trading down as its key index dropped more than two percent, dragged down by the recent attacks on the kingdom's key oil facilities.
The Tadawul All Share Index lost around 2.5 percent as it hit 7,629.49 points after the opening bell. The drop was reportedly led by Al Rajhi Bank and Saudi Basic Industries Corporation, both of which slid around three percent.
The Arab world's largest equity market regained some losses later in the day, standing at 7,734.94 points, but still down 1.24 percent, as of 10am GMT.
Sunday's decline wipes out gains the market made this year, according to Reuters. The Tadawul All Share Index is down about 18 percent from this year's high of 9,403 points and down 1.8 percent compared to September 2018.
Other regional markets were not spared from the consequences of the drone attacks. Stocks, including those in Kuwait's premier index, fell around one percent, while equity markets in United Arab Emirates, Qatar, and Bahrain lost up to 1.3 percent, according to Bloomberg.
The blow to the kingdom's stock market comes as oil major Saudi Aramco is reportedly preparing for local listing, and it could become the world's biggest initial public offering (IPO). However, the oil company is unlikely to change its mind on the matter, as the attack "will have only a limited impact on interest in Aramco shares," political risk research and consulting firm Eurasia Group said, as cited by Reuters.
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Comment: Sputnik, 15/9/2019: IRGC General: 'Ready for War - two US bases, warship within range of Iran's missiles Sputnik, 15/9/2019: Iraq denies drones attacking Saudi oil facilities were launched from Iraq Sputnik, 15/9/2019: Saudi attack may nudge US to 'go to war' with Iran Sputnik, 15/9/2019: Zarif: US will not end war in Yemen by blaming Iran for everything RT, 15/9/2019: Massive heart attack for oil market? Drone raid may push oil to $100 RT, 15/9/2019: Saudi stocks slump after drone strikes hit Aramco oil plants