The unmanned vehicle attack on the Saudi crude oil production facility on Saturday has affected the production of the global oil supply by five percent. The attack was on two major oil facilities in the Saudi Arabia and it has resulted in output cut of 5.7 million barrel per day. The attack has decreased the oil production of the Saudi by more than 50 percent and a global threat has been emerged. The significant effect of the attack can be easily seen in the surge of the price of the crude oil all over the globe. The oil surge moved to almost 20%, which is the biggest since the 1980s. Only after the statement by the US president Donald Trump that there is no shortage of oil, the price of the crude oil took down a bit. However, the tweet “Plenty of Oil” coming amid the tension is somewhat out of context but looking at the reputation of Mr. President as twitter user, this awkward tweet is something normal that can be expected from the president of the United States.
The attack has left the whole world wondering who was responsible for this huge destruction. As per some reports, the attack might be repeated in near future and Saudi Arabia has to fully active with its security. Yemen's Houthi rebels has taken the responsibility for the attack, which has been long-locked in war with the Saudi Arabia. Despite, there is no proof, the United States has blamed Iran as the main culprit for the attack. However, Iran has disapproved of this fact stating that they were not involved in the attack. China has backed Iran amid the tension and has said that it is irresponsible behaviour to put blame without any proof.
Donald Trump has also said that the USA do not want to go on a war but they are ready for any kind of attack. In a tweet, he has mentioned that they have reasons to believe that they know who the culprit are, and that the US are waiting for the Saudis to respond or ask them to respond.
In the meantime, Saudi Arabia has said that they will invite United Nations and other international experts to investigate the attack. A statement came from the Saudi Ministry of Foreign Affairs on Monday that says, the kingdom will take the appropriate actions depending on the results of the investigation, to ensure its security and stability. The ministry has also said that Saudi Arabia affirms that it has the capability and resolve to defend its land and people, and to forcefully respond to these aggressions.
While the world is facing the threat of economy slowdown and it is already visible in many developed and developing countries of the world. Many sectors including auto and textile are showing slowdown all across the globe and this attack might lead to economy depression if the situation is not taken care of in an appropriate manner. The price of the crude oil has surged to all time high, only to show some relaxation after US President Donald Trump tweet that says there is no shortage of crude oil. Mr Trump has gone ahead to say that they do not need oil from the middle-east countries and they have reserved oil for at least next one year.
Ivan Petrella, associate professor of economics at Warwick Business School, says:
“With the economy already showing clear signs of slowing down in most developed and developing countries, high oil prices could be the straw that breaks the camel’s back contributing to a recession.
“Central banks around the world will be forced to rethink their current policy stance if this rise in oil prices is passed onto the public through inflation.”
Although every country has their oil reservoir for around 90 days for emergency situations like this, right now, it is not possible to predict how long Saudi Arabia will take to restore the oil production. In this threat possessing situation, every country has to come together to fight the problems. However, some tweet and reactions by the United States are showing that they are ready to attack the third world country. This is surely not the way things should be going as amid the economic slowdown, a war is not even the last things one should opt for.