On Sunday, September 15th, Professor Sara Vakhshouri spoke with BBC and Bloomberg about the impact of the drone attack on a major Saudi Arabian oil plant.
Professor Vakshouri spoke in both interviews about how people should not expect a shock to the oil market because Saudi Arabia has plenty of domestic inventories of crude oil that will last them about 30 days.
“Saudi Arabia is one of the largest producers and exporters of crude oil and the only country that has the spare capacity for the event of interruption in the supply,” Professor Vakhshouri said in her interview with BBC News.
She also noted that Saudi Arabia has inventories around the world such as the ones in Japan, Egypt and the Netherlands. There are also inventories in the U.S., China, and the E.U. that can still supply the market.
However, Professor Vakhshouri pointed out that there will be a gradual rise in oil prices because of the uncertainty of when the Saudi oil plant will continue production and how fast it will come back. The potential for future attacks will also make oil prices rise.
Despite the geopolitical tensions in the region, Saudi Arabia continues to be resilient and has the infrastructure to maintain oil supply.
Professor Vakshouri is the founder and president at SVB Energy International (SVBEI). SVBEI is a strategic energy consulting firm with offices in Washington DC and Dubai. At IWP, Professor Vakshouri teaches Energy Security and the New Geopolitics of Energy.