Tanzania oil prices to remain stable despite attacks on Saudi Arabia hub

Wednesday September 18 2019

 

By Rosemary Mirondo @mwaikama rmirondo@tz.nationmedia.com

Dar es Salaam. Energy and Water Utility Regulatory Authority (EWURA)
has assured the public that the recent attack on a major hub of Saudi
Arabia's oil fields will not affect prices in Tanzania because there is enough stock of petroleum products.
Ewura public relations manager, Titus Kaguo told The Citizen in an interview that Tanzania had procured petroleum two months ago prior to importation.
He was responding to the fact that an attack on a major hub of Saudi
Arabia's oil production over the weekend has rattled a region and left
people worried.
“The products which are in the market this September were procured
July this year. Generally our stock levels are sufficient for the country’s consumption,” said Mr Titus Kaguo.
He explained that the consignment that was procured in August 2019 for
October’s consumption is on transit to the country.
However, he noted that the country could experience the impact of Saudi
Arabia’s attack in November and then only if other factors that affect
price increase come into effect.
Reports show that the pre-dawn attacks on Saturday knocked out more
than half of crude output from the world's top exporter - five per cent
of the global oil supply - and cut output by 5.7 million barrels per
day.
Yemen's Houthi rebels, who have been locked in a war with a
Saudi-UAE-led coalition since 2015, claimed responsibility for the
attacks, warning Saudi Arabia that their targets "will keep
expanding".
The attack managed to remove 5 per cent of the world's daily oil output
from the market.
Early Saturday morning, two oil production facilities in northern
Saudi Arabia were attacked and several structures were heavily
damaged.
The Khurais oil field produces about 1.5 million barrels of oil a day
when online, while the Abqaiq facility, the country's largest, refines
an estimated 7 million barrels per day for export.
Saudi Arabia alone produces about 10 percent of the world's oil,
that's about 9 million barrels daily.
And the attack reduced Saudi Arabia's daily out output by 5.7 million
barrels. About 5 percent of the total oil produced around the world
each day is no longer for sale while the damage is repaired.
Oil prices on Monday when markets reopened jumped as high
as 16 percent before settling down to be 10 per cent higher than before
the attack took place, about $60 a barrel.