Yahoo Finance Expert: Saudi Arabia's vulnerability 'the biggest surprise' of drone attack
Oil prices soared on Monday in reaction to Saudi Arabia’s oil facilities being attacked over the weekend.
While the world was still grappling with the after-effects, one expert said there was one thing that he found most shocking about the drone-powered strike, which effectively wiped out half of the country’s output. Saudi Arabia churns out at least 10 million barrels per day.
“The biggest surprise is the degree and sophistication of the attack as well as the vulnerability of the Saudi facilities,” Ion Energy Group Consultant Kyle Cooper told Yahoo Finance’s YFi PM.
“It was widely assumed that there were very significant defenses in place and that was the case. But yet there were multiple, multiple attacks that were able to breach these defenses,” he added.
Cooper expressed surprise at “the lack of defense” from the Saudis in what should have been a well-fortified facility.
Questions are also looming over exactly who is responsible for the attacks that cut over 5% of global crude oil production in one of the world’s top oil producing countries.
The attack on Saudi Arabia’s Abaqiq facility was claimed by Yemen’s Houthi rebels, which are aligned with Iran. The latter’s suspected involvement also prompted concerns about whether the U.S. could be draw into a confrontation.
When asked if Iran is the culprit, President Trump told reporters Monday afternoon “it’s looking that way.”
Cooper contended that there remain a lot of “unknowns” for the outlook on oil production moving forward. But he added that U.S. oil was a good investment, given that a terrorist attack on American facilities were “much less likely” for the market.
Still, Saudi Arabia’s troubles “clearly reintroduces a much higher degree of supply risk in the market that has not been there for many, many years,” he said.
McKenzie Stratigopoulos is a producer at Yahoo Finance. Follow her on Twitter: @mckenziestrat
Read more:
Goldman: Here are the stocks set to gain from surging oil prices
Attack on Saudi Arabia's oil infrastructure 'may have been an overstep': expert on Iran
Read the latest financial and business news from Yahoo Finance
Follow Yahoo Finance on Twitter, Facebook, Instagram, Flipboard, SmartNews, LinkedIn, YouTube, and reddit.
