RIYADH – The weapons used to strike Saudi oil facilities were Iranian-made, the Riyadh-led coalition said Monday, heightening fears of regional conflict after the U.S. hinted at a military response to the assault. The weekend strikes on Abqaiq -- the world's largest oil processing facility -- and the Khurais oil field in eastern Saudi Arabia have roiled global energy markets sending prices spiking Monday. Yemen's Iran-aligned Houthi rebels claimed responsibility for the strikes but Washington has squarely blamed Iran, with President Donald Trump saying the U.S. is "locked and loaded" to respond. Saudi's energy infrastructure has been hit before, but this strike was of a different order, abruptly halting 5.7 million barrels per day (bpd), or about 6 percent of the world's oil supply. The Saudi-led coalition, which is bogged down in a five-year war in neighboring Yemen, reiterated the assessment that the Houthis were not behind it, pointing the finger at Iran for providing the weapons.
The International Monetary Fund (IMF) highlighted Saudi Arabia's economic turmoil, due in large part to a drop in oil prices over the past two years, when it cut its 2016 growth forecast for the country on Wednesday. The country's non-oil sector, projected in May to grow at 1.6 percent, more likely "just breaks even" this year with a growth rate of 0.3 percent, IMF Middle East regional director Masood Ahmed told the Associated Press on Wednesday. Its overall gross domestic product (GDP) growth for 2016 would hit just 1.2 percent, the lowest expansion in eight years, according to the IMF. With crude prices more than halving from the summer of 2014 to that of 2016, the Gulf state, where nearly 39 percent of GDP stems from oil production, is becoming increasingly reliant on other sectors. In its regional outlook report for the Middle East and Central Asia, released Wednesday, the IMF projected dismal growth for many of Saudi Arabia's peers in the Gulf Cooperation Council (GCC), a group of six oil-exporting nations headquartered in Saudi's capital, Riyadh.
Oil prices were steady on Thursday on mixed market signals ahead of an OPEC meeting in Vienna, which analysts said was not expected to result in restrictions on crude output. International Brent crude oil futures were trading at 49.77 per barrel at 0200 GMT, up 5 cents from their last settlement, while U.S. West Texas Intermediate crude was down 9 cents at 48.92 a barrel. OPEC is set for another showdown between rivals Saudi Arabia and Iran when it meets on Thursday in the Austrian capital, with Riyadh trying to revive coordinated action or a formal oil output target, but Tehran refusing to cooperate. "An output ceiling has no benefit to us," said Iranian Oil Minister Bijan Zanganeh as the country tries to recoup lost market share following the lifting of sanctions against it in January. Despite rising output by OPEC's Middle Eastern producers, the group's overall production has remained largely flat this year, currently standing at 32.5 million barrels per day (bpd), capped by disruptions especially in Nigeria, Libya and Venezuela.
BEIRUT – A senior official with the main U.S.-backed force in Syria says his fighters have captured the country's largest gas field from the Islamic State group in an eastern province that borders Iraq. Nasser Haj Mansour of the Syrian Democratic Forces says the Conoco gas field came under full control of the group on Saturday after days of fighting with the extremists. Britain-based Syrian Observatory for Human Rights, which tracks the war in Syria, says SDF fighters have not yet taken the field in the province of Deir el-Zour, saying fighting is ongoing outside it. SDF fighters have been marching on the east bank of the Euphrates River in Deir el-Zour while Syrian troops are gaining in areas on the west bank of the river under the cover of Russian airstrikes.