Sep 15 (Lagos) - World's crude oil supply could be in disarray as a result of the attacks on oil production facilities of Saudi Arabia's state owned company Aramco. Half of Saudi Arabia's oil production has been affected by these attacks.
The attacks also put a question on the proposed sale of Aramco in an IPO and its valuation. Aramco said it could knock 50% of its capacity off-line which means about 5 million barrels a day. Company also said that it has sufficient reserves in 3 reserve facilities around the globe from where if will meet the shortfall.
Some analysts are expecting Brent crude oil price to increase by 2-5 dollars a barrel in the short term. Some other analysts are already calling for $100/barrel oil price.
The world will look towards USA and Canada to increase the supply should there be a spike in demand as a result of this shortfall.
On Friday, West Texas Intermediate crude for October delivery CLV19, +0.88% fell 24 cents, or 0.4%, to settle at $54.85 a barrel on the New York Mercantile Exchange (NYMEX). November Brent crude BRNX19, +0.05% shed 16 cents, or 0.3%, to $60.22 a barrel on the ICE Futures, with prices marking a weekly fall of 2.1%.
The volatile situation in the middle east is about to become more volatile as Saudi has blamed Iran for these attacks. Iran has denied any involvement.
This is a developing story. This attack was massive is going to alter the supply lines of global crude oil markets. Nigeria should be prepared to supply any markets which are affected by this.
reporting for easykobo.com on Sunday, Sep 15 2019 from Lagos, Nigeria