The Yemen Rebel Attack on Saudi Aramco Oil Facility and Its Consequences

On the eve of the 2022 Jeddah Formula 1 Grand Prix (Sunday, 27 March), an Aramco oil depot was engulfed in flames after a missile attack claimed by Yemeni Houthi rebels.

The photo of Aramco’s burning Jeddah oil depot close to the Formula 1 racetrack became a dramatic symbol of the complicated challenges the country is facing both internationally and domestically. It is not the first time Saudi oil industry facilities have been targeted. In September 2019, Houthis claimed responsibility for pre-dawn attacks by a combination of drones and cruise missiles on two major oil facilities in Jizan, Saudi Arabia. That attack temporarily knocked out 5.7 barrels a day, i.e. 5 percent of global crude oil demand. 

However, in the context of a worldwide economic downturn, an ongoing fifth wave of the COVID-19 pandemic, a war and an escalating humanitarian crisis in Ukraine, the current situation turns out to be even more complicated for the Saudi economy and the country’s international position.

The attack on the Aramco facilities is likely to raise crude oil prices further. Yet more importantly, it has exposed the country’s vulnerable political, economic and military position, particularly after the withdrawal of American support for the Saudi war against the Iran-backed Houthis. Now some of the country’s most prominent English-speaking media outlets intend to switch the narrative from the issues of human rights violations — on March 12, Saudi Arabia executed a record number of 81 people on terrorism-related offences — and accusations of “sportswashing” to an emerging energy crisis resulting from the attack on the Aramco oil depot.

As Faisal J. Abbas, editor-in-chief of Arab News, wrote in his 26 March editorial, “the Kingdom cannot and should not be left alone to safeguard global energy supplies when the entire world is hurt from price hikes”. He also called on the leaders of the “free world”, particularly Saudi Arabia’s long-term ally, the US, to express its active support for the Kingdom of Saudi Arabia (KSA), and to recognize that Saudi oil facilities classify as “civilian infrastructure”, and that their targeting is an issue of international concern. In addition, he urged the US to label the attack as a terrorist attack that threatened global security.

Nonetheless, so far these arguments seem to have failed to persuade anyone outside the Kingdom or to have had an impact on the current state of Saudi’s international affairs. The latter was also confirmed by the statement by the US Secretary of State a day after the attack. He condemned the attacks, acknowledging that this was an attack against civilian infrastructure. However, he was reluctant to characterize it as a terrorist attack. This also reflects the Biden administration’s firm decision to withdraw its support for the unpopular Saudi-led intervention in Yemen — which previous US administrations eagerly supported since its beginning in 2015 — and to partly distance itself from it in the long-term.

The emphasis on so-called global energy security and the critical role of the KSA as a worldwide energy supplier is not a new communication strategy for Saudi spokespersons and the media — they pursue it whenever current issues undermine the Kingdom’s efforts to improve its international image. One year ago, when the Saudi Arabian Formula 1 Grand Prix was confirmed, [1] Saudi Arabian officials proudly claimed that this event marked the “transformational journey the country is on”.

Nonetheless, the F1 Grand Prix was overshadowed by the shocking news of the mass executions of 81 individuals (73 Saudi citizens, seven Yemenis, and a Syrian national) on 12 March for terrorism-related offences and the confirmed attack on the Jeddah pipelines by Houthi rebels. Moreover, in the aftermath of a two-year-long pandemic, which had a significant negative impact on the Saudi economy — leading to a decrease in crude oil production and a historical oil price fluctuation — and with the implementation of the Saudi Vision 2030 modernization programme halted by the restrictions of the pandemic, Saudi Arabia’s “rebranding” and attempts to diversify its economy have failed to provide a satisfactory outcome. Meanwhile, the country has become more isolated at the international level, suffering a serious rupture with one of its most significant allies, the US.

Therefore, the only card left for the Saudis to play is that of oil energy. Saudi Arabia continues to fashion itself as the most significant global oil supplier. At the same time, Saudi officials and energy policymakers describe the country as the “oil supplier of last resort” due to its immense reserves and comparatively low-cost units. However, the current energy crisis differs from the 1973 oil shortage crisis because it involves not only oil but natural gas as well, and Saudi Arabia — despite the gas reserves it claims to hold (roughly 8 trillion cubic metres) — is not involved in the international gas market, providing gas only to domestic users.

On the other hand, this “return” to Saudi Arabia’s role as an international oil supplier contradicts Crown Prince Mohammad bin Salman’s declared goals of diversifying the Saudi economy through the development of sophisticated tourist infrastructure in the country and attracting corporations and foreign investors, without the support of which the majority of the mega-projects such as NEOM cannot be completed. Likewise, the country cannot be considered an attractive destination for tourist investment and development when issues of security are at stake.

Moreover, despite the modernizing narratives and the legislative reforms introduced (including the abolition of the religious police and the improvement of women’s legal status), the country cannot avoid being considered a human rights-violating regime that continues a devastating attack on a neighbouring country with immense humanitarian costs.

On top of everything, there is a growing sense of disappointment inside the country regarding the shrinking Saudi economy, the pandemic measures, and the rise in utility bills and oil for domestic consumers. In this context, Saudi Arabia cannot avoid presenting itself as a typical “petrostate”, proclaiming its key role in safeguarding global oil supplies and oil stability. After all, this is the only way for the country to “be taken seriously” and to secure its access to international community meetings and politics.