On Monday, US oil producers within the S&P 500 surged as crude prices rose due to a drone attack on Saudi Arabian facilities, which wiped out the world’s supply by 5%.
After Saturday, the sector took drone strikes that wiped out a lot of Saudi Arabia’s oil production. The value of crude oil spiked more than 20%, marking the significant intraday increase since 1988.
Although they later stabilized, the attacks have resulted in the highest oil costs since early July.
The 5 biggest movers collectively produce more than 1.8 million barrels of oil per day, based on regulatory filings.
The two drone attacks on Saudi oil-fields caused about 6 million barrels of daily production. The strikes additionally crippled backup facilities, which could have produced 2.27 million extra barrels per day. Although markets must be well equipped within the short term, it could take around months to return to earlier production levels.
The Saturday attack “successfully eliminates the world’s spare capacity,” S&P Global Platts global head of market insight Sarah Cottle told to the news channel.
Exxon Mobil raised about 3.3% in early trading, and Chevron surged 3.4%.
Brent crude oil per barrel trades at $66.71, ET Monday, up about 10.8% from the last closing value. If the disturbance to the global oil supply chain lasts more than six weeks, prices can reach $75 per barrel, stated by Goldman Sachs analysts.