Saudi Arabia: Explosion Near Oil Refinery

An explosion was heard at the Abqaiq oil refinery in Baqiq, located in eastern Saudi Arabia, on Feb. 24. Al Arabiya satellite television network reports that the explosion was a militant attempt to bomb the refinery using vehicles filled with explosives. The explosion comes on the heels of a call from al Qaeda second-in-command Ayman al-Zawahiri that the war against the Saudi government had failed and attacks against oil infrastructure should commence. Both the United States and Australia have issued Warden Messages within the past month, saying they had indications militants continued to plan attacks in the region close to the Baqiq refinery. It should also be noted that while the target of this attack might have been oil infrastructure, it is not the actual site of oil production, nor did the militants attempt to destroy the resource. If the explosion was in fact linked to militants in the kingdom, it is an indication that although the militancy has been largely contained for more than a year — since the Dec. 27, 2004, attempted attack against the Saudi Interior Ministry Building in Riyadh — the militant infrastructure and ideology has not been entirely destroyed. Further, the attack indicates that the militants have shifted their target set from the government itself to the government's sources of funding and power. The attackers certainly did not believe that their two car bombs would obliterate a facility that covers several acres, and at this point it appears that only one of Abqaiq's myriad pipelines was damaged, but that does not take any significance away from this attack. The Abqaiq facility is among Saudi Arabia's most critical energy facilities, serving as a processing facility that sees some two-thirds of the country's 10 million barrels per day (bpd) of daily output at some point. Abqaiq serves as a gathering and processing center for the majority of Saudi Arabia's central desert and Empty Quarter production, and then divides the crude into pipelines that ship it on to the country's various export platforms such as Ras Tanura and Ras al-Juaymah on the Persian Gulf, as well as Yanbu on the Red Sea. There are few workarounds for the Abqaiq facility and if it had been knocked offline the effects on energy prices would have been immediate and dire. Bear in mind that the Venezuelan oil strike combined with the Iraqi war of 2003, which only resulted in the removal of about 3.5 million bpd from the markets, contributed to a 40 percent price increase — and in those cases very little was actually damaged. The memory of the 1973 oil embargo made the oil markets oversensitive to the ebb and flow of the Israeli-Palestinian issue, despite the fact that the neither Israelis nor the Palestinians consume, produce or transit major amounts of crude. Al Qaeda has now presented something much more concrete to worry about. No significant oil asset has found itself under militant attack since the Sept. 11 attacks; Abqaiq is one of the world’s most critical pieces of energy infrastructure. Simply that it was selected for targeting by al Qaeda should be reason enough — and a sound reason at that — for some panic.