Tanzania oil prices to remain stable despite attacks on Saudi Arabia hub
What you need to know:
According to Ewura petroleum products that are meant for consumption in October were purchased in August and it is already on transit.
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.
