Drone Strikes Impact Saudi Oil Facilities
LULU GARCIA-NAVARRO, HOST:
The United States is calling it an unprecedented attack on the world's energy supplies. A drone strike on two of Saudi Arabia's key oil installations has forced the kingdom to shut down about half of its oil production. Houthi rebels in neighboring Yemen have claimed responsibility, but Secretary of State Mike Pompeo accused Iran of being behind the attack, dramatically raising tensions in the Persian Gulf region.
NPR's Jackie Northam has been following developments and joins us now. Good morning.
JACKIE NORTHAM, BYLINE: Good morning, Lulu.
GARCIA-NAVARRO: What details do we know about these attacks on Saudi Arabia's oil facilities?
NORTHAM: Well, we know that the strikes on these two oil installations in the eastern part of Saudi Arabia were carried out by drones, and Houthi rebels in Yemen say they used 10 drones in the attack. The target was two facilities that belonged to the state-owned oil company Saudi Aramco. They happened early morning, the attacks, and there were some pretty dramatic photos of fires burning at these installations.
The Saudis say the fires are now under control, but no word yet on the extent of the damage. But the kingdom is suspending the production of more than 5.5 million barrels of crude a day because of these strikes. And you know, that's more than half of Saudi Arabia's daily output. So we'll just have to see when they can get these facilities up and running again.
GARCIA-NAVARRO: And I imagine that's going to have a big impact on the supply and the price of oil.
NORTHAM: It could. You know, Saudi Arabia is a giant oil exporter. Up until just recently, it was the world's largest oil exporter. But the attacks on these two installations will mean the loss of about 5% of the global oil supply, which could increase the price of oil globally. But you know, Lulu, these attacks happen as the kingdom is looking to sell off a slice of Saudi Aramco in an initial public offering, which could be worth hundreds of billions of dollars for the kingdom. And certainly, security of the oil supplies and management of the company are critical to any potential investors. And so to have this sort of brazen strike on these oil installations is going to be a challenge for Saudi Aramco and the Saudi government.
GARCIA-NAVARRO: Iran, of course, is allied with the Houthi rebels who claimed responsibility for the attack. The Houthi rebels themselves say that Iran is not behind these attacks. What proof is Secretary of State Mike Pompeo offering?
NORTHAM: He is not offering any. In fact, he said there was no evidence that the attack came from Yemen. And you know, that's led to some speculation that the U.S. may believe the strikes were launched either from Iran or by some Iranian proxies in Iraq.
You know, Iran is denying any involvement, and one of its foreign ministry spokesmen dismissed Pompeo's comments as maximum lies. But as you say, Iran backs the Houthi rebels in Yemen, and that's where a Saudi-led coalition has launched a lot of airstrikes over the past four years, killing thousands of rebels and civilians and creating a humanitarian disaster. But again, there is no clear sign that Iran was involved in these attacks.
GARCIA-NAVARRO: So this has happened as the U.S. is increasing its so-called maximum pressure campaign on Iran, using sanctions and the like to force Iran to renegotiate its nuclear deal. And we've also had some comments this morning from Iran. Give us the context here.
NORTHAM: You know, Lulu, there's every chance that this situation could increase tension in the Persian Gulf. We've seen a lot of activity there lately with oil tankers. This is all happening ahead - just ahead of the United Nations General Assembly that's coming up this month. President Trump has said he's open to meeting with Iran's President Hassan Rouhani. But, you know, that may be sidelined now with these strikes, especially if the U.S. is seen as blaming Iran for these attacks in Saudi Arabia. President Trump called Saudi Arabia's crown prince and offered some support for what he called Saudi Arabia's self-defense and that the U.S. is committed to ensuring global oil markets are stable. But it's a very tense situation in the Persian Gulf right now, and it could escalate.
GARCIA-NAVARRO: That's NPR's Jackie Northam. Thank you so much.
NORTHAM: Thanks very much, Lulu. Transcript provided by NPR, Copyright NPR.