Saudi shuffles will soften oil losses

Significance

That attack knocked 5.7 million b/d offline. Prince Abdelaziz bin Salman, the new energy minister, suggested that the entire Abqaiq output would be restored by the end of September, and that total capacity would reach 12 million b/d by the end of November. Actual production would recover to its pre-attack 9.8 million b/d by October.

Impacts

• A repeat attack or a slower recovery than officials predict would support prices into next year.
• Other countries in the OPEC+ deal will step up production, against Saudi wishes, to meet any market shortfalls.
• If prices were significantly elevated for several months, US shale producers would respond with increased drilling.