INSIGHTi
Attacks on Saudi Oil Facilities: Effects and
Responses
September 27, 2019
September 14, 2019, saw an attack on Saudi Aramco’s, Saudi Arabia’s national oil company, Abqaiq oil
processing facility and Khurais oil field and processing plant. The attack, which used both missiles and
drones, temporarily disrupted 5.7 million barrels per day (mb/d) of oil production, over half of Saudi
Arabia’s oil production and about 5% of global supply. For context, U.S. crude oil production is
approximately 12 mb/d.
Abqaiq Facility
Abqaiq is a key processing facility for Saudi Arabia crude. Two important functions provided by Abqaiq
include (1) crude oil stabilization, a process that removes hydrogen sulfide and reduces the volatility of
crude oil to specifications required for shipping, and (2) gas oil separation, where oil is separated from
other hydrocarbons such as methane, butane, and propane. The Abqaiq facility was reportedly operating
at about 4.9 mb/d prior to the attack and has a maximum capacity of 7 mb/d. According to Bloomberg,
Abqaiq suffered five strikes on crude-stabilization towers and another 11 strikes on infrastructure that
separates gaseous hydrocarbons from crude oil.
Khurais Field and Facility
The Khurais field has a production capacity of 1.5 mb/d under normal circumstances. All oil from the
Khurais field is processed on site. Khurais processing infrastructure suffered damage to four crude-
stabilization towers, with differing degrees of damage.
Restoration Efforts
Saudi Aramco is working to replace the disrupted supply and restore production capacity. Reportedly,
Aramco is utilizing oil from storage to meet current export commitments as well as spare capacity not
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affected by the attacks. Increased production from offshore fields with heavier and higher sulfur crude oil
are also being used. Prince Abdulaziz bin Salman, the Saudi energy minister, announced the country
would produce 11 mb/d by September 30 (an amount higher than the pre-attack level of 9.8 mb/d,) and
then increase to 12 mb/d by November 30. Some Saudi officials believe restoring production will take
longer. Reportedly, Khurais restored 30% of production within 24 hours of the attack.
Typically, Saudi Arabia has been known to keep about 1.5 mb/d to 2.0 mb/d of spare capacity,
traditionally the majority of OPEC spare capacity. Spare production capacity, as defined by the U.S.
Energy Information Administration (EIA), is production that can be brought online within 30 days and
sustained for 90 days. Since the September 2019 attacks, Iran may now be OPEC’s majority holder of
spare capacity, an unintended consequence of U.S. sanction on Iran. The International Energy Agency
(IEA), founded to coordinate member responses to major oil disruptions, has not announced any plans to
coordinate a release of oil strategic supplies (crude or petroleum products) from member countries (which
includes the United States), but according to a press release from September 14, it is monitoring the
situation closely.
Prices
Crude oil markets responded to the September 2019 attacks with an initial price rise (see Figure 1). The
price of the U.S. benchmark crude, West Texas Intermediate (WTI), on Friday before the attacks was
$54.80 per barrel, while the international benchmark, known as Brent, was $60.22. At the market’s close
on September 16, WTI was priced at $62.67 and Brent was $69.02, a roughly 14% increase for both. EIA
analysis indicates that this was the largest single-day price increase for both price benchmarks over the
last decade. As of September 27, benchmark oil prices are still above pre-attack levels by $1.04 and
$1.58, respectively.
Figure 1. Brent and WTI Prices
Close of Day (US$ per Barrel)
Source: Bloomberg L.P.
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Implications for Saudi Arabia and Saudi-U.S. Relations
Saudi and U.S. officials have downplayed claims by Yemen’s Houthi rebels that they carried out the
attacks, instead attributing responsibility to Iran. The strikes were the latest in a series of cross-border
attacks on energy and transportation sites in the kingdom apparently linked to the ongoing war in Yemen
and the Saudi-U.S. confrontation with Iran. The incidents have demonstrated the vulnerability of critical
Saudi infrastructure to missile and drone attacks and raised complicated strategic questions for Saudi and
U.S. policymakers concerning responses and future security needs. On September 20, U.S. officials
announced plans to deploy additional U.S. military personnel to Saudi Arabia and speed military
equipment deliveries to Gulf partners to bolster capabilities and deter further attacks. The U.S.
government also announced additional sanctions against Iran’s Central Bank and other entities. Iran’s
government denies U.S. and Saudi charges of responsibility and has pledged to retaliate for any future
attacks on Iran. Saudi Arabia and Houthi officials have reached a partial cease-fire in the war in Yemen,
after Houthi forces declared a unilateral cease-fire in the week after the September 14 attacks.
Saudi Arabia’s military operations in Yemen have created demands on security and defense capabilities
and have contributed to fiscal pressures facing the kingdom. Trends in oil prices prior to the September
2019 attack saw prices remain below the kingdom’s budget targets. Saudi leaders deny reports that they
may substantially delay a planned initial public offering of shares in Aramco, which is intended to raise
funding for economic reform efforts. However, additional attacks, or delays in restoration efforts, could
reduce investor confidence. Over time, oil export volumes, market prices, and security and reconstruction
costs will determine the attacks’ fiscal effects on the kingdom.
Author Information
Heather L. Greenley
Christopher M. Blanchard
Analyst in Energy Policy
Specialist in Middle Eastern Affairs
Michael Ratner
Specialist in Energy Policy
Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan shared staff
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