A drone attack by Huthi rebels in Yemen, backed by Iran, hit oil production facilities in Saudi Arabia last Friday and caused a production stop to the tune of 5.7 million barrels per day. Or putting it another way, halting 6% of the world’s oil supply (). Something fun to do might be to sit outside a gas station and watch the price of a liter gas (and diesel) flicker up and down as the extent of the strike damage filters up to us here in Sweden.
The Swedish Energy Agency, energimyndigheten, states that Sweden imports about 22 million cubic meters of crude oil a year, mostly from the North Sea and Russia. We also have some heavy duty refining companies (see Preem blog here) making us, believe it or not, also an exporter of refined petroleum products. Be that as it may, the drone strike has led to the highest single-day oil price increase, in Sweden, ever ().
But it doesn’t stop there. All those Wish orders from China clogging up PostNord? China, but also India and South Korea, import huge amounts of oil from Saudi Arabia. The increase in cost makes manufacturing and transport even more expensive. Eventually, that makes the price we pay here also more expensive. Even if there is no shortage of petroleum in the world, and most countries have even a certain back-up supply, the hit makes things uncertain and unstable – two “un”s that spell turbulence.
Although the Huthi rebels have taken responsibility for the drone attack, there remain some doubts as to whether or not they could really have done it. Worst would be if they prove they can by doing it again. It also puts an extreme damper of the worst kind on Sweden’s hopes of helping mediate an end to the war. Since Margot Wallström has left the building at Arvfurstens palats it’s unlikely that our new Minister for Foreign Affairs Ann Linde will pick up the glove. It looks like she wouldn’t find any interested parties over there anyway.