Saudi Arabia closed its largest oil refinery, the Ras Tanura, on Monday due to a drone strike amid rising tensions in the Middle East following Israeli and U. S. military actions and Iranian responses. This escalation resulted in precautionary shutdowns of oil and gas facilities throughout the region, disrupting oil production in Iraqi Kurdistan and major Israeli gas fields, which limited exports to Egypt.
As a result of these developments, oil prices jumped by 13% to over $82 a barrel, the highest level since January 2025. The conflict has significantly affected shipping through the Strait of Hormuz, a vital route that carries one-fifth of the world’s oil supply. Saudi Aramco’s Ras Tanura refinery, capable of processing 550,000 barrels per day, was shut down as a safety precaution, although no damages were reported.
In Iraqi Kurdistan, oil production has been halted by companies including DNO, Gulf Keystone Petroleum, Dana Gas, and HKN Energy, stopping the export of around 200,000 barrels per day to Turkey. Offshore Israel, Chevron was instructed to temporarily shut down the Leviathan gas field, while Energean ceased production at smaller gas fields.
Meanwhile, explosions were reported in Iran at Kharg Island, a facility that processes the majority of its crude exports, although the extent of the damage is still unclear. Iran, a key OPEC member, produces approximately 4.5% of global oil supplies.
On Monday, drones attacked a facility owned by Qatar Energy, and authorities are currently evaluating the damage. The Saudi defense ministry confirmed that two drones were intercepted at the Ras Tanura refinery, causing a small fire but no injuries. Although Ras Tanura’s shutdown has raised supply concerns, local petroleum supplies remain unaffected.
Experts view the strike on the refinery as a major escalation in conflicts, indicating that Gulf states, including Saudi Arabia, may align more closely with U. S. and Israeli military efforts against Iran. Previous attacks on Saudi oil facilities, such as those in 2019 and 2021, highlight the vulnerability of Gulf energy infrastructure.
With information from Reuters
