Saudi Arabia’s oil tankers suffered a “sabotage attack” on Sunday off the coast of Fujairah, UAE, reports Platts.
What happened?
Saudi Arabia’s two oil tankers were targeted in “sabotage attack” off the coast of Fujairah, United Arab Emirates, near the world’s biggest crude shipping chokepoint.
The tankers were on their way to cross into the Arabian Gulf, with one of them scheduled to load with Saudi crude oil from the port of Ras Tanura and delivered to Saudi Aramco’s customers in the US, Saudi Press Agency (SPA) reported Monday.
Tensions have risen in the region since US waivers ended on Iran’s shipments of crude earlier in May. While the attack didn’t lead to any casualties or oil spill, there was “significant damage” to both vessels, it said. SPA didn’t identify the ships involved or say who was responsible.
Crude trade to have impact
Crude oil futures were higher in Monday trading as supply concerns outweighed the trade dispute between the US and China.
July Brent crude futures rose 0.5% from Friday’s settle to $70.96/b, and NYMEX June light sweet crude gained 0.1% to $61.73/b.
“If the incident is isolated, the market is likely to remain calm at this time of the year when global refining maintenance is reaching peak levels in May,” said Kang Wu, head of analytics, Asia, at S&P Global Platts.
“As the driving season arrives, similar disruptions on a prolonged basis will have a much bigger impact down the road.”
Business as usual
The Fujairah port source said port operations were “business as usual”.
The UAE has a pipeline that it could divert crude to Fujairah in the event that Hormuz is blocked.
The Habshan pipeline has a capacity of 1.5 million b/d, around half of the UAE’s total crude production.
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Source: Platts
