(Bloomberg) – Aramco halted operations at Saudi Arabia’s largest oil refinery at Ras Tanura on the Persian Gulf coast after a drone strike in the area.
Gasoil futures jumped on news of the closure of the refinery that’s a key supplier of diesel, as Iran intensified attacks that damaged critical energy infrastructure in the region.
Aramco shut the 550,000 barrel-a-day Ras Tanura plant on Monday as a precaution while assessing damage, the Saudi Energy Ministry said in statement to the country’s state news agency.
There was a “limited” fire at the plant caused by debris from the interception of two drones that were targeting the facility and the blaze was “immediately contained,” the Saudi Press Agency said. Aramco’s media office did not respond to a request for comment.
ICE gasoil futures surged more than 20%, the biggest intraday gain since March 2022, while crude oil in London was trading about 9% higher near $79 a barrel.
Hostilities in the Middle East started over the weekend with the U.S. and Israel attacking Iran, which retaliated by firing hundreds of missiles and drones at countries around the region. An attack on major energy infrastructure is a nightmare scenario for global markets, with maritime traffic through the crucial Strait of Hormuz all but halting.
QatarEnergy was forced to suspend production of liquefied natural gas due attacks on facilities at Ras Laffan and Mesaieed. Kuwait said debris from intercepted missiles fell on the site of one of its refineries and a power station was hit.
The Ras Tanura refinery is a key supplier of transport fuels like diesel for buyers in Europe and produces smaller quantities of gasoline. Nearby is Aramco’s biggest export terminal for crude and oil products, including storage tanks, berths at the port and offshore loading points.
Crude exports from Ras Tanura’s sea island — and the nearby single-point moorings at Ju’aymah — appear to be running at pace, according to Bloomberg tanker tracking. All six of the moorings are operating and there are two supertankers and one mid-sized Aframax vessel loading at the sea island.
