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U.S. blames Iran for Saudi oil attack, Trump says 'locked and loaded'

CommoditiesSep 16, 2019 04:57AM ET
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By Roberta Rampton and Arshad Mohammed

WASHINGTON (Reuters) - U.S. President Donald Trump said on Sunday the United States was "locked and loaded" for a potential response to the attack on Saudi Arabia's oil facilities, after a senior U.S. administration official said Iran was to blame.

Trump also authorized the use of the U.S. emergency oil stockpile to ensure stable supplies after the attack, which shut 5% of world production and sent crude prices soaring more than 19% in early trade on Monday, before moderating to show a 10% gain.

"There is reason to believe that we know the culprit, are locked and loaded depending on verification, but are waiting to hear from the Kingdom as to who they believe was the cause of this attack, and under what terms we would proceed!" Trump said on Twitter.

Earlier in the day, a senior U.S. official told reporters that evidence from the attack, which hit the world's biggest oil-processing facility, indicated Iran was behind it, instead of the Yemeni Houthi group that had claimed responsibility.

U.S. Secretary of State Mike Pompeo also said there was no evidence the attack came from Yemen, where a Saudi-led coalition has been battling the Houthis for over four years in a conflict widely seen as a proxy war between Saudi Arabia and Shi'ite Muslim rival Iran.

"Amid all the calls for de-escalation, Iran has now launched an unprecedented attack on the world's energy supply," Pompeo said.

Iranian Foreign Ministry spokesman Abbas Mousavi dismissed the U.S. allegations that it was responsible was "pointless". A senior Revolutionary Guards commander warned the Islamic Republic was ready for "full-fledged" war.

"All American bases and their aircraft carriers in a distance of up to 2,000 kilometers around Iran are within the range of our missiles," the semi-official Tasnim news agency quoted Commander Amirali Hajizadeh as saying.

Tensions between Washington and Tehran were already running high because of a long-running dispute between the two nations over Iran's nuclear program that led the United States to impose sweeping sanctions.

Oil prices surged as much as 19% in early Asian trade on Monday on worries over global supply and soaring tensions in the Middle East.

Brent crude posted its biggest intra-day percentage gain since the start of the Gulf War in 1991.

State oil giant Saudi Aramco said the attack on Saturday had cut output by 5.7 million barrels per day.

The U.S. official, who asked not to be named, said on Sunday there were 19 points of impact in the attack on Saudi facilities and evidence showed the launch area was west-northwest of the targets - not south from Yemen.

The official added that Saudi officials indicated they had seen signs that cruise missiles were used in the attack, which is inconsistent with the Iran-aligned Houthi group’s claim that it conducted the attack with 10 drones.

"There's no doubt that Iran is responsible for this. No matter how you slice it, there's no escaping it. There's no other candidate," the official told reporters.

Riyadh has accused Iran of being behind previous attacks on oil-pumping stations and the Shaybah oil field, charges that Tehran denies, but has not blamed anyone for Saturday's strike. Riyadh also says Tehran arms the Houthis, a charge both deny.

Richard Nephew, a program director at Columbia University's Center on Global Energy Policy, said if Iran was responsible for the attack, it may be as retribution for U.S. sanctions.

"They are making decisions about whether and how to respond to what they see as a massive attack on their interests from the U.S. via sanctions by attacking U.S. interests in turn, and those of U.S. partners they believe are responsible for U.S. policy," he said.

Aramco gave no timeline for output resumption. A source close to the matter told Reuters the return to full oil capacity could take "weeks, not days".

Riyadh said it would compensate for the damage at its facilities by drawing on its stocks, which stood at 188 million barrels in June, according to official data.

Trump said he had "authorized the release of oil from the Strategic Petroleum Reserve, if needed, in a to-be-determined amount sufficient to keep the markets well-supplied."

CALLS FOR RESTRAINT

Consultancy Rapidan Energy Group said images of the Abqaiq facility after the attack showed about five of its stabilization towers appeared to have been destroyed, and would take months to rebuild - something that could curtail output for a prolonged period.

"However Saudi Aramco keeps some redundancy in the system to maintain production during maintenance," Rapidan added, meaning operations could return to pre-attack levels sooner.

The Saudi bourse closed down 1.1% on Sunday, with banking and petrochemical shares taking the biggest hit. Saudi petrochemical firms announced a significant reduction in feedstock supplies.

"Abqaiq is the nerve center of the Saudi energy system. Even if exports resume in the next 24 to 48 hours, the image of invulnerability has been altered," Helima Croft, global head of commodity strategy at RBC Capital Markets, told Reuters.

Some Iraqi media outlets said the attack came from there. Baghdad denied that on Sunday and vowed to punish anyone using Iraq, where Iran-backed paramilitary groups wield increasing power, as a launchpad for attacks.

Kuwait, which borders Iraq, said it was investigating the sighting of a drone over its territory and coordinating with Saudi Arabia and other countries.

U.N. Secretary-General Antonio Guterres condemned Saturday's attacks and called on all parties to exercise restraint and prevent any escalation. The European Union warned the strikes posed a real threat to regional security, and several nations urged restraint.

The attack came after Trump said a meeting with Iranian President Hassan Rouhani was possible at the U.N. General Assembly in New York this month. Tehran ruled out talks until sanctions are lifted.

But Trump appeared on Sunday to play down the chances he might be willing to meet with Iranian officials, saying reports he would do so without conditions were not accurate.

As recently as last Tuesday, Pompeo said Trump "is prepared to meet with no preconditions".

Saudi de facto ruler Crown Prince Mohammed bin Salman told Trump that Riyadh was ready to deal with "terrorist aggression". A Saudi-led coalition has responded to past Houthi attacks with air strikes on the group's military sites in Yemen.

The conflict has been in military stalemate for years. The Saudi alliance has air supremacy but has come under scrutiny over civilian deaths and a humanitarian crisis that has left millions facing starvation.

U.S. blames Iran for Saudi oil attack, Trump says 'locked and loaded'
 

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Stacey Beam
Stacey Beam Sep 18, 2019 8:57AM ET
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And? Neither the US or Saudi A is going to retaliate militarily. China won't stand for it, and the US won't ruffle their feathers because trade deal.
Al Vlaj
alvlaj Sep 16, 2019 7:21AM ET
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So the US prez is waiting on instructions from the Saudis on how to proceed...
Job Johnny
Job Johnny Sep 16, 2019 7:21AM ET
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The US is not dependent upon Rag Head oil any more.
Silverbug 19
Silverbug 19 Sep 16, 2019 6:07AM ET
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Saudi's degrade women. Where are all the Men haters in America?
Silverbug 19
Silverbug 19 Sep 16, 2019 6:06AM ET
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Syrian chemical attacks were all US. Nobody cares.
toto caca
toto caca Sep 16, 2019 5:36AM ET
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Saudi IS a cancer and cause if terrorism in thé World Allahou akbar
Liran Shrem
Liran Shrem Sep 16, 2019 1:36AM ET
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time to start twitting with some b52 birds!!
Cee Kay
Cee Kay Sep 16, 2019 1:00AM ET
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It will be loaded and locked until the end of the worldm
Don Getty
Don Getty Sep 16, 2019 12:02AM ET
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the Dictator doesn't have the ba lls and will have to wait until the adults tell him what he can tweet.
Bade Sahib
Bade Sahib Sep 15, 2019 9:26PM ET
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Dows Trump have the courage to take on Iran dont think so . He will backpeddlw as always.
Bade Sahib
Bade Sahib Sep 15, 2019 9:25PM ET
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Iran is toast
Hank Williams
Hank Williams Sep 15, 2019 9:20PM ET
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The Chosen one learned a new term.
Nordin Mohamad
Nordin Mohamad Sep 15, 2019 8:44PM ET
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is this the 3rd world war starting point ..?
Victor Lew
Victor Lew Sep 15, 2019 8:44PM ET
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never
Don Getty
Don Getty Sep 15, 2019 8:44PM ET
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nah neither china or russia will step in on Iran's side
David Wong
David Wong Sep 15, 2019 8:12PM ET
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Locked and Loaded? Iran said they have missles that can fired at all our bases within 2000 miles.
Mohammad Abdullah
Mohammad Abdullah Sep 15, 2019 8:12PM ET
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sit 2000 kilometers. less than 900 miles.
Buzzy Jefferson
Buzzy Jefferson Sep 15, 2019 8:12PM ET
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They’re not “your” bases “David” Wong.
Jozef Drozd
Jozef Drozd Sep 15, 2019 8:12PM ET
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Mohammad Abdullahabout 1250 miles .
Jason Patcher
Jason Patcher Sep 15, 2019 7:09PM ET
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Carlos, did you forget Iran attacked tankers last month? This would be normal activity for them. Persians are cool but the government fundamentalist
Steven Ownz
Turtle_Steven Sep 15, 2019 7:09PM ET
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yeah but you forgot to mention that west seized Iran ship first. what your doing is calling someone fighting back a bully. lol. just impossible to let each other alone. lol
Buzzy Jefferson
Buzzy Jefferson Sep 15, 2019 7:09PM ET
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Turtle_Steven . Iran should soon learn who not to pick fights with. It’s not about fighting back. It’s about knowing where you are on the pecking order. Foolish pride does little to better the lives of your people, as Iran knows all too well.
Jason Patcher
Jason Patcher Sep 15, 2019 7:09PM ET
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sure we siezed one, they mined 1 or 2, captured by force even a Japan flag. threaten to other countries right to exist. They stop, there would be no issues. If we stop, they continue...
Steven Ownz
Turtle_Steven Sep 15, 2019 7:03PM ET
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doesn't matter if we blame this on Iran. we have already sanction it's economy to near fullest extend, the only thing left is to invade. so are we going to invade? and if so for what? we sanctions them first, they haven't attacked us, nor have they ever made a move against the us other than shouting nonsense. we have done a lot of harm to Iran due to insecurity of ourselves, so are we going to send our children to war for military companies and political benefits of our politicians? is bolton or sons of trump going to the front line? nope it is our dispensable citizens.
Carlos Martinez
Carlos Martinez Sep 15, 2019 5:27PM ET
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Any one with a half brain can see, saudis sabotage their own oil to benefit. We know for a fact they would ********their own people for freedom of expression. !- need and want to get the sale of heavy destruction weapons from usa. 2. need oil prices to go higher. They now market is loaded with excess oil and  can use the excused to sell what is in storage at a way high premium. 3. Blame iran and Yemenis for it. saudis are notorious for lying and deceiving. Why would iran make matters worst when they know and want to open up their economy? it is the saudis running the show pulling the strings on the usa goverment. Open your eyes. .
Marko Blisse
Marko Blisse Sep 15, 2019 5:27PM ET
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Well every low brained person can see it. But if it is the truth is still not verifiable even if it makes big sense. The situation in the middle east goes on for quite some time and SA is fighting together with the UAE against Yemen and also embargoed together Qatar as they work together on an oil production site and by that being partners. They cause tensions since a while and for sure you could suspect them staging such an incident. They also lied about Yemen and independent investigations are an alien concept!
Marko Blisse
Marko Blisse Sep 15, 2019 5:27PM ET
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Edit: Qatar of course work together with the Iran on an oil production site....they basically share it. The way I structured the sentence might imply they work together with Yemen on that production site....my bad! ;)
Buzzy Jefferson
Buzzy Jefferson Sep 15, 2019 5:27PM ET
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Since when does Iran want to “open up their economy”? They are the world’s #1 sponsor of terrorism. There is absolutely ZERO intent to get along with other countries. They are theocratic whack jobs who would love to drop nukes on neighbors if they had them. Iran needs to be dealt with once and for all.
Marko Blisse
Marko Blisse Sep 15, 2019 5:27PM ET
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Buzzy Jefferson fun fact, which country were in involved in the majority of battles since WW2? Or better asking which country loves to drop some bombs as it has the biggest military complex and lobby!? Maybe the country I am talking about is fitting your description more then Iran.... ;)
 
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