U.S. President Trump said Sunday he’s authorized a fast-track approach to pipeline approvals in Texas and other states following the attacks on Saudi oil facilities Saturday, Kallanish Energy reports.
The terrorist attacks on Saudi Arabia’s Abqaia and Khurais oil plants have cut Saudi production by 5.7 million barrels per day (Mmbpd) — over 5% of the global supply.
“Based on the attack on Saudi Arabia, which may have an impact on oil prices, I have authorized the release of oil from the Strategic Petroleum Reserve, if needed, on a to-be-determined amount, sufficient to keep the markets well-supplied.” he tweeted.
“I have also informed all appropriate agencies to expedite approvals of the oil pipelines currently in the permitting process in Texas and various other states,” he added, without disclosing specifics on the pipelines.
Data from the U.S. Energy Information Adminstration shows eight pipeline projects have been announced and are due to start operations in the third and fourth quarters of 2019. They could be impacted by Trump’s calls.
If oil pipeline bottlenecks are reduced and more crude supply reaches the exports markets, the price differential between West Texas Intermediate (WTI) and Brent crude futures is likely to narrow. Brent still is expected to trade higher, however, due to a geopolitical risk premium returning to the global oil benchmark.
On early European trading, WTI rose as much as 16%, to $63.34 a barrel, before easing to $59.59/Bbl. That’s an increase of 8.64% over the previous close – prior to the attacks. Brent was trading at $65.43/Bbl, or up 8.65%, after gaining nearly $12/Bbl.
According to the U.S. Department of Energy, the country’s strategic petroleum reserves at Sept. 6, stood at 644.8 million barrels (Mmbbl), of which 394.5 Mmbbl of the crude were sour, and 250.3 Mmbbl were sweet.
This post appeared first on Kallanish Energy News.