Recent attacks targeting Saudi Arabia have reignited supply and geopolitical concerns in the oil markets, according to OCBC’s Christopher Wong [1]. Over the weekend, Houthis claimed responsibility for missile and drone strikes on Riyadh and an Aramco facility at Yanbu. However, Saudi authorities reported that these attacks on Yanbu and several other locations were thwarted, with no new damage to oil infrastructure [1].
Despite the absence of fresh infrastructure damage, existing issues persist. The East-West pipeline remains damaged, and loadings at Yanbu have been disrupted, highlighting ongoing risks to supply [1]. Brent crude prices had eased to around US$105 per barrel on Friday as earlier supply concerns moderated, but the weekend’s developments serve as a reminder that disruption risks are still present [1].
Wong suggests that the near-term downside in Brent and WTI prices may be limited unless Saudi oil flows return to normal and attacks on energy infrastructure subside. The continued threat of supply disruptions is expected to provide some renewed support for oil prices in the short term [1].
CONCLUSION
The recent thwarted attacks in Saudi Arabia have kept oil supply and geopolitical risks in focus, despite no new infrastructure damage. Ongoing pipeline issues and disrupted loadings suggest that oil prices may find support, with further downside likely limited until Saudi flows normalize and security concerns ease.