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Houthi missiles hit Saudi Aramco's headquarters in Dhahran on October 13, starting a fire. Oil producers stand to gain from the added Gulf risk, while airlines face higher fuel costs. Qatar's gas exports, about a fifth of world liquefied gas trade, have also been disrupted.
Source: Bloomberg ↗
Houthi missiles hit Saudi Aramco's executive headquarters in Dhahran on October 13 and set part of the complex on fire. This followed a week-long barrage against Saudi airports, refineries, a crude export port, and the East-West pipeline. Oil producers such as Exxon Mobil (XOM) and ConocoPhillips (COP) earn more when crude is high. Airlines such as Delta Air Lines (DAL) pay more for fuel when crude rises. How much the strike ultimately moves prices is not yet clear. QatarEnergy had already halted liquefied gas production after earlier drone attacks. On October 13, Qatar's Amir said the damage at Ras Laffan had disrupted a significant share of its exports. Each new attack makes a quick return of Gulf supply look less likely.
In the five trading days to October 12, ConocoPhillips shares rose 7.1% and Exxon Mobil rose 5.0%, while Delta Air Lines fell 3.6%. Those moves came before the October 13 strike on Aramco's headquarters. Investors had already been rewarding oil producers and marking down airlines as Gulf attacks spread.
The link weakens if Gulf supply comes back fast. Qatar-linked liquefied gas tankers had already begun crossing the Strait of Hormuz again in late September. The sign to watch is that traffic growing to normal levels, or QatarEnergy restarting more Ras Laffan output, over the coming weeks.
Attack-driven price spikes can fade quickly. After the 2019 Abqaiq attack, Brent gave back its jump within weeks once Saudi output was restored. A Reuters company source said a ballistic missile damaged the top three floors of an office tower, while the Energy Ministry described a limited fire with no injuries. No oil output was hit in this strike. Brent rose less than 1% on the day. If Hormuz reopens or a ceasefire holds, oil prices could fall fast. Exxon's and ConocoPhillips's gains would shrink with them, and Delta's fuel costs would ease.
In September 2019, a drone and missile attack on Aramco's Abqaiq and Khurais facilities cut about 5.7 million barrels a day of Saudi output. Brent jumped about 15% in a single day, then gave the gain back within weeks as Saudi output was restored.
The Dhahran strike on October 13 adds to a week-long Houthi campaign that has already hit Saudi refineries, a crude export port and the East-West pipeline. That campaign, not the office-building strike alone, is what raises the risk to Saudi supply. It helps oil producers like Exxon Mobil and ConocoPhillips and hurts airlines like Delta through fuel costs.
The same regional war has already hit Qatar. QatarEnergy halted liquefied gas production in early March after drone attacks on Mesaieed and Ras Laffan, and the Hormuz closure has cut a significant share of its exports.
With Gulf oil and gas supply both under strain, a further attack makes a quick return of that supply less likely. That keeps fuel costs high for airlines.
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