Targeting oil facilities in Saudi Arabia: The price of oil jumps to $110 per barrel

Sanaa - Ofoq News - The Houthis in Yemen announced a new attack on oil facilities, airports and military targets in Saudi Arabia, and the price of a barrel of Brent crude reached $110.10 this morning, after touching $110.70 in the previous session.

This is a price level not seen in about five months, and the main concern in the markets is that repeated attacks on energy infrastructure and shipping lines will turn the oil shortage into a long-term problem.

According to the Houthis, recent attacks targeted an Aramco facility in the coastal city of Yanbu, the strategic Shaybah oil field, King Khalid International Airport in Riyadh, and Abha Airport.

The Saudi authorities have not fully confirmed the Houthi allegations, and the extent of the damage resulting from the recent attack remains unclear. However, the threat facing Saudi energy facilities is real, as previous attacks caused severe damage to Aramco's infrastructure, forcing the company to make urgent repairs to ensure continued oil supplies.

The economic problem goes far beyond the physical damage to a particular facility. The Kingdom of Saudi Arabia is one of the most important oil suppliers in the world, and any disruption in its ability to produce, transport and export oil increases fears of a global shortage. Even as facilities are quickly rehabilitated, shipping companies, insurance companies and energy traders are taking into account the risk that the next shipment will not reach its destination.

At the same time, attacks on ships in the Persian Gulf and the Strait of Hormuz continue. Data tracking the movement of oil tankers indicates a sharp decline in the volume of oil flowing through the region, from an average of more than 20 million barrels per day to only about 8.5 million barrels during the past week. This represents a strong blow to one of the most important energy arteries in the global economy.

Added to this equation is the threat facing the Bab al-Mandab Strait, which connects the Red Sea to the Indian Ocean. When both the Strait of Hormuz and the shipping lanes leading to the Suez Canal are threatened, options for bypassing dangerous areas diminish, and the cost of transporting energy rises.

The escalation is not limited to Saudi Arabia. A missile attack launched by the Houthis on a training camp belonging to the Yemeni government forces in Shabwa Governorate resulted in the killing of at least 53 people and the injury of more than 200 others. This incident shows that the campaign in Yemen is expanding in parallel with the regional war and the damage to the economic infrastructure.

The crisis poses a very serious political and economic problem for US President Donald Trump, two weeks before the midterm congressional elections. The rise in oil prices has negatively affected the prices of fuel, sea and land transport, aviation, industry, and consumer products. The longer the crisis lasts, the greater the fear of renewed inflationary pressures and harm to growth.

Trump has taken steps to ease some restrictions on Russian energy trade, hoping to increase supplies and lower prices. But increasing Russian exports alone is not enough to solve the security problem in the Gulf, and markets are still focused on the risks of oil tankers and oil facilities being exposed to material damage.

Israel is not immune to these repercussions either. Oil prices affect fuel costs, transportation, imports, flights, and production. If prices continue to rise, this rise may gradually be transmitted to the Israeli consumer, making it more difficult to confront the high cost of living.

The greatest risk does not necessarily lie in another sharp rise in the price of a barrel of oil tomorrow morning, but rather in the possibility that the world will enter a prolonged period of high energy prices, transportation risks, and supply instability. Even quickly restarting oil facilities will not solve the problem as long as oil tankers are unable to sail safely.

In other words, the Houthis do not need to completely shut down the Saudi oil industry to cause global economic damage, but rather keep supply lines under constant threat.

When the price of a barrel of oil reaches $110, the bill will eventually affect every family.