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Aramco Attacks Could Be Black Swan Event!

aramco oil field drone attack

This isn’t going to be our typical style of article, this one is in response to a black swan event that happened over the weekend and deeply affected markets today and will continue to over the weeks to come. Overnight the Aramco Saudi oil fields were attacked by a combination of drones and missiles with a confirmed 19 points of impact total with 17 of those on key infrastructure .

  • 5% global oil supply temporarily stopped
  • 19.5% rise in Brent crude price
  • 50% CUT to Saudi output
  • 5.7 Million barrel per day reduction in output
  • $405 Million losses per day for Saudi Arabia

Secretary of State Mike Pompeo was quick to blame Iran (of course) over tensions with Yemen, and Trump has been weighing in on the situation, at first and probably reacting stated “locked and loaded”, then as the day went on they started to walk that back. President Trump said it was “looking like Iran was behind this weekend’s attacks” on Saudi oil facilities, but added that “he doesn’t want to go war with anyone.”

There has been satellite images that support that Iran could be behind the attacks, which would give them a decent amount of deniability.

A look at drone range and incidents

The drone in question is likely what the UN has called the UAVX. Houthi’s call this long-range drone a ‘’Samad-3’’. The drone itself remains elusive, with few details released about its technical capabilities, but it appears to pack quite the punch

That actually isn’t true, we have been slowly decreasing our reserves according to this data…

“I don’t want to have war with anybody” but our military is prepared, Trump says at the White House, where he was meeting with Bahrain Crown Prince Salman bin Hamad Al Khalifa. Furthermore, the president said the US is not looking at retaliatory options until he has “definitive proof” that Iran was responsible for attacks on Saudi Arabian oil facilities.

This sparked an interesting reaction from 2020 runner Tulsi Gabbard who had the following harsh words to say…

Here is a look at total market sources for OPEC production, you can see that they are down overall.

From our understanding these fires are not easy to put out and this has severely crippled Saudi’s oil production, they were looking to restore production to “normal levels” by Monday by from what we could find so far this is still ongoing and it could take weeks to solve.

Iranian President Hassan Rouhani said an attack targeting Saudi Aramco crude oil installation over the weekend was the result of a years-long war that Saudi Arabia has waged on Yemen.

From Bloomberg…
“The people of Yemen are forced to respond to all the the violations and the flood of weapons from U.S. and Europe toward Saudi Arabia and the United Arab Emirates,” Rouhani said in a televised press conference in Ankara, where he met Russia’s Vladimir Putin and Turkey’s Recep Tayyip Erdogan for talks on Syria.

This whole situation has sparked international concern and one that could escalate quite quickly and turn into a Black Swan similar to what we saw in 1990 when Iraq invaded Kuwait destroying substantial oil reserves, in less than 4 months from that event oil price rose over 170%.

Update #1

We had reported in the discord community back on Sept 12th of this looming Aramco IPO which is set to be one of the biggest in the world!

  • Saudi Aramco is preparing for what could turn out to be the world’s largest initial public offering.
  • The state-run oil company is currently aiming to list as much as 5% of its shares sometime between 2020 and 2021.
  • Saudi officials have suggested Aramco may be worth as much as $2 trillion in the past, which means the company could raise close to $100 billion through an IPO.
  • If Aramco were to list 5% of its shares at a $2 trillion valuation, it could raise as much $100 billion through the offering. That’s four times the largest IPO in history.

This is interesting timing to say the least, here is Saudi Arabia’s carefully worded statement thus far.

  • Weapons In Attack Iranian, investigating Source
  • Calls on int’l community to take responsibility+counter attacks
  • Saudi to invite int’l Experts and from UN to investigate
  • Based on outcome will take measures
  • Affirms ability to defend itself

Update #2

Oil prices can be track here, so far we are seeing upwards of an $8 price jump

Here is Senior Iranian official talking earlier in August about engaging the west.

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