Attacks On Oil Facility In Saudi Arabia Fuels Spike In Crude Prices

AAA says that will eventually lead to higher prices at the pump.

 

Towson, Md (KM) Get ready for sticker shock when you fill up your car, truck or SUV. AAA Mid-Atlantic says last weekend’s attacks on oil facilities in Saudi Arabia are expected to lead to an increase in the price of crude oil, which will eventually result in higher gasoline costs, possibly this week.

Spokeswoman Ragina Ali says the attacks on those facilities took 5.7-million barrels of crude off the market, and that accounts for 6% of the global supply.

Last week, she says, the national average price of gasoline was $2.56 per gallon. But the price of crude oil shot up during Monday’s trading. “With crude oil trading at $5-per barrel more than what they were trading on Friday’s closing,” she says. That pushes the price up to $61 per barrel.

“Unfortunately, because of this, it is quite likely that motorists will begin to see prices jump throughout this week,” says Ali.

AAA says the national average price of unleaded regular gasoline stood at $2.56 per gallon on Monday, which is a drop of one-cent from last week. In Maryland, the average price is $2.44 per gallon, unchanged from last week. The auto club says in Frederick, the price inched up by two cents to $2.45 per gallon on Monday.
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The US does not receive a lot of crude oil from Saudi Arabia. The latest from  Energy Information Agency says during the first half of this year, the US received about 18,000 barrels of crude oil from the Saudi, which is down from 35,600 the first half of 2017.

But AAA says this shutdown of the oil facilities in Saudi Arabia will affect the international price of crude oil. “President Trump says he has authorized the release of crude from the Strategic Petroleum Reserve. Also, other Saudi Oil consuming countries also have emergency reserves to help back-fill  the global loss, if needed,” Ali says.

She says it’s not certain when these oil facilities will be repaired andl be in operation once again. “Damage to the facilities is actually still being assessed. So there’s no word if it will be days, weeks or even months before the infrastructure is repaired,” Ali says.

 

By Kevin McManus