Oil prices jumped on global markets Sunday night after a wave of weekend drone attacks instantly erased half of Saudi Arabia’s oil production.
Brent crude on Sunday traded at $70.98 per barrel on oil futures markets, an 18 percent surge from Friday’s close of $60.15, before falling back to about a 12 percent increase. U.S. benchmark West Texas intermediate crude opened at $61.27 per barrel, a 12 percent climb, before easing to a 10 percent gain.
The attack on Saudi Arabia’s oil infrastructure immediately knocked out 5.7 million barrels — or nearly 6 percent of the 100 million barrels the world consumes per day.
Oil prices could spike in the next several days as a result of the attack on Saudi’s state-run oil company, Saudi Aramco, the second-largest oil producer in the world at 9.85 million barrels per day in August.
“The Saudis are scrambling to make repairs and keep the oil flowing,” said John Kilduff of Again Capital. “The response will determine how high prices go and for how long.”
A jump in oil prices is likely to weigh on an already-declining global economy, one beset by the U.S. trade war with China, White House sanctions against Iran and a decade-long economic expansion that shows signs of petering out.
On Sunday, Saudi officials said only one-third of the affected 5.7 million barrels would be restored by Monday, leaving millions of barrels per day offline indefinitely.