Saudi Arabia temporarily closed its largest domestic oil refinery on Monday following a drone strike, according to a source, as escalating Israeli and US operations against Iran — and Tehran’s retaliatory attacks — triggered disruptions to energy infrastructure across the Middle East.

The latest round of strikes marked the third consecutive day of violence affecting the region’s oil and gas sector. In response to security concerns, most crude production in Iraqi Kurdistan was halted as a precaution, and several major Israeli offshore gas fields were also taken offline, curbing exports to Egypt.

Saudi Aramco’s Ras Tanura refinery, which has a processing capacity of 550,000 barrels per day, was shut down as a preventive measure. The refinery forms part of a major energy hub along the kingdom’s Gulf coastline and functions as a key export terminal for Saudi crude.

In Iraqi Kurdistan, where approximately 200,000 barrels per day were shipped via pipeline to Turkey’s Ceyhan port in February, companies including DNO, Gulf Keystone Petroleum, Dana Gas and HKN Energy suspended operations at their fields as a precaution. No physical damage was reported at those sites.

Off Israel’s Mediterranean coast, the Leviathan natural gas field, operated by Chevron, was shut on Saturday, sources said. Energean also halted operations at its floating production unit servicing smaller gas reservoirs.

The situation at Aramco’s Ras Tanura refinery is under control, the source said. Two drones were intercepted at the facility, with debris causing a limited fire, the Saudi defense ministry’s spokesperson said on Al Arabiya TV, adding there were no injuries.

Saudi state news agency SPA reported, citing an unnamed energy ministry official, that while some refinery units were taken offline as a precaution, domestic supplies of petroleum and refined products were not disrupted.

Even so, the refinery’s temporary closure is likely to intensify concerns about global supply. Shipping traffic through the Strait of Hormuz — a critical waterway through which roughly one-fifth of global oil consumption passes — has slowed sharply after vessels were targeted in the area on Sunday. Brent crude futures jumped about 10% on Monday, climbing above $82 per barrel.

“The attack on Saudi Arabia’s Ras Tanura refinery marks a significant escalation, with Gulf energy infrastructure now squarely in Iran’s sights,” said Torbjorn Soltvedt, principal Middle East analyst at risk intelligence firm Verisk Maplecroft.

“The attack is also likely to move Saudi Arabia and neighboring Gulf states closer to joining U.S. and Israeli military operations against Iran.”

Saudi energy infrastructure has been targeted in the past. In September 2019, coordinated drone and missile attacks on the Abqaiq and Khurais facilities temporarily knocked out more than half of the kingdom’s crude production capacity.

Ras Tanura itself was previously targeted in 2021 by Yemen’s Iran-aligned Houthi movement.

{Matzav.com}