Saudi Arabia restores oil production after drone attack
Saudi Arabia has restored much of its oil production less than two weeks after a drone attack struck refineries in the kingdom.
State oil company Saudi Aramco has restarted production of 11.3m barrels of oil a day, sources briefed on the issue told Reuters.
Read more: How could the oil attacks in Saudi Arabia affect investment?
The Khurais field is now producing 1.3m barrels a day, while another field, Abqaiq, has reached 4.9m.
Oil prices dropped this morning, with Brent crude falling 1.7 per cent to $62.04 a barrel.
Prices rose dramatically after the attack on 14 September, which knocked out half of Saudi oil production – or five per cent of global supply. Brent jumped by as much as 20 per cent on the Monday following the news.
The US, Britain and Saudi Arabia have all pointed the finger of blame at Iran for the attack.
The Islamic republic meanwhile claims that Houthi fighters in Yemen launched the drones. The UK has dismissed this as unlikely.
It came after months of increasing tensions in the area, including the downing of a US drone by Iran in June.
Global markets have been closely following what happens in the Middle East, especially around the Gulf of Hormuz through which ships carry around one fifth of global oil supplies.
Read more: Boris Johnson blames Iran for drone attack on Saudi oil
This morning Harry Tchilinguirian, an oil expert at BNP Paribas, said that oil prices are likely to fall further unless there is a repeat attack on Saudi Arabia.
“Focus will return to faltering oil demand concerns as there is unlikely to be any quick resolution to US-China trade differences to positively shift economic expectations,” he told Reuters.