Dubai — Attacks on Saudi Aramco's giant Abqaiq crude processing plant last September threatened a heart attack moment for the global oil market and the kingdom's cherished reputation as a reliable supplier. Disaster was averted by speedy repairs, but the episode has left lingering doubts among some experts over its readiness to prevent a copycat strike from penetrating its defenses.
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A year on and concerns remain that a repeat of the Sept. 14, 2019, attacks on the world's most important oil infrastructure continues to be a risk that Aramco and policymakers cannot afford to ignore.
"Neither Saudi Arabia nor the United States were prepared to defend against a drone or cruise missile attack," said Bob McNally, president of Rapidan Energy Group and former White House adviser, speaking in an interview. "But Abqaiq is still vulnerable. I assume Aramco has improved the defenses since the 2019 attack. It would be almost unthinkable for them not to."
It took just 10 days for Aramco to make initial repairs and restore total output to 10 million b/d after drones and missiles disabled the sprawling Eastern Province facility, which McNally describes as the "beating heart of the global oil system." Oil prices saw some of the biggest spikes in 30 years as traders weighed the potential for a prolonged disruption to supplies from the world's largest exporter of crude.
Aramco has insisted in a statement to S&P Global Platts that its response to the attacks proves its resilience and furthermore the oil giant "has robust emergency response and business continuity plans in place to ensure uninterrupted supply of products to its customers in the event of unforeseen scenarios."
Aramco went into overdrive to fix Abqaiq by mobilizing an army of international contractors and engineers. The company -- which would debut on the Saudi stock exchange three months later in a much vaunted public listing -- also embarked on a publicity blitz to restore its reputation, similarly damaged by the attacks, which Houthi rebels in Yemen had claimed responsible for.
However, McNally believes the rapid restoration of Abqaiq and the Khurais oil field could have been aided by the Iran-backed Houthi's poor aim.
"They punctured seven of the eleven depressurization units, but those were literally just patched and could go back to work. They didn't rupture them. Only three of the 18 stabilization columns were destroyed, and they had redundancy at the plant, and could surge other columns beyond the normal operating limits," said McNally.
During the outage, Aramco's customers rushed to compensate for potential supply shortages as the attacks reverberated around markets. To maintain shipments, the kingdom was forced to draw on its storage capacity and domestic inventories.
"It cost a lot of money for refiners that are dependent on Saudi crude. Aramco had to postpone some of the deliveries so obviously the refiners had to scramble a little bit," said Vandana Hari, founder and CEO of Singapore-based consultancy Vanda Insights, in an interview. "But by the end of the month, Aramco dipped into its reserves as well. This was a good strategy by the company. Aramco also diverted about 1 million b/d from its domestic refineries to markets abroad."
Aramco's frantic efforts to maintain shipments to customers created a knock-on effect where Saudi Arabia, instead of exporting refined products, may have been temporarily importing them, Hari added.
"No shipments to international customers were missed as a result of the attacks," said a Aramco in its statement to Platts.
The kingdom's ability to intercept new drone attacks is uncertain without the continued support of the US military, which was briefly beefed up in the immediate aftermath of last year's strike and mounting tensions with Iran around the Strait of Hormuz.
Abqaiq had come after a string of incidents targeting the kingdom's oil facilities including its East-West Pipeline, which is intended to reduce its dependence on the vulnerable Strait of Hormuz seaway separating the Arabian Peninsula from Iran. Neighboring Abu Dhabi is currently building strategic storage in the port of Fujairah, partly in response to the threat posed by Iran.
"What is concerning for me is that the other aspect of this is what steps, if any, has Saudi Arabia taken to make sure such a thing doesn't happen again. [This is] is all the customers want to know," said Hari.
Confirming the identity of the Abqaiq attackers would be a start. Houthi rebels -- locked in a bitter war with Riyadh in Yemen -- were quick to claim responsibility. But experts have questioned their capacity to conduct a military operation on this scale without direct help from Iran. Tehran denied involvement immediately.
"There is a bit of worry on this count, who attacked, how they attacked and how they managed to be so precise," Hari said. "If that mystery has not really been solved, then one could compute that Saudi Arabia doesn't really know how to prevent such an attack."