Oil price tumbles to $65 on Saudi recovery

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The international oil benchmark, Brent crude, dropped sharply on Tuesday, following Monday’s surge that sent shock waves around the world.

Brent, against which Nigeria’s crude oil is price, surged by nearly 20 per cent on Monday after attacks on Saudi Arabia’s oil infrastructure cut more than half of the country’s production.

It rose as much as 19.5 per cent to $71.95 per barrel, the biggest intraday increase since January 14, 1991, before dropping to around $68.

The oil price dropped further on Tuesday, trading around $65.03 per barrel as of 7:40pm Nigerian time.

Drone strikes attacked an oil processing facility at Abqaiq and the nearby Khurais oil field on Saturday, knocking out 5.7 million barrels of daily crude production — or 50 per cent of the kingdom’s oil output. Abqaiq is the world’s largest petroleum processing plant.

Reuters reported on Tuesday that Saudi Arabia’s oil output would be fully restored quicker than thought.

The kingdom was close to restoring 70 per cent of the 5.7 million barrels per day production lost due to the attacks, according to one source, a top Saudi official briefed on progress.

The source was quoted as saying that the state-run Saudi Aramco’s output would be fully back online in the next two to three weeks.

On Monday, two sources briefed on the company’s operations had said a full return to normal oil production volumes “may take months.”

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