Saudi Aramco and Oil Prices: How Could Attacks Shape the Future of the Global Oil Market?

Recent attacks on Saudi Arabia’s oil infrastructure and growing concerns about the security of energy supplies have once again affected the global oil market. On October 23, 2026, Brent crude futures settled 3.14% higher at $116.72 per barrel, their highest settlement in nearly six months. This increase followed a series of attacks targeting Saudi Arabia and concerns about potential disruptions to oil supplies. This dated settlement is a historical reference for the analysis, not a current oil-price quote.

But why do developments involving Saudi Aramco matter so much to the global market? Could continued tensions push oil prices to $130 or even $150 per barrel? And, more importantly, what impact could these developments have on the global economy and investment opportunities?

To answer these questions, we first need to understand Aramco’s strategic role and its position in global energy security.

Why Is Aramco One of the Most Important Players in the Global Oil Market?

To understand Aramco’s importance, it is enough to look at the scale of its operations. In 2025, Aramco produced approximately 12.9 million barrels of oil equivalent per day. In simple terms, this figure does not include crude oil alone; it also covers natural gas and the company’s other hydrocarbon products. Of this total, approximately 10.7 million barrels per day came from crude oil and other hydrocarbon liquids. These figures demonstrate the significant role Aramco plays in supplying energy to the world.

Aramco’s importance is not limited to its production volume. The company operates across several stages of the energy value chain, from oil and gas extraction to refining and petrochemical production. As a result, any disruption to its operations could affect both crude oil supplies and the petroleum products market.

The 2019 Attack: A Wake-Up Call for the Global Oil Market

The significance of this issue became clear in September 2019. During the attack on the Abqaiq facilities and the Khurais oil field, approximately 5.7 million barrels of daily crude oil production were temporarily halted, equivalent to around 5% of global oil supply at the time.

The incident demonstrated that damage to just a few critical facilities could disrupt a significant share of global oil supplies. Brent crude futures also surged by nearly 20% at one point during the first trading day following the attack; this was an intraday move, not the closing-day percentage gain.

However, today’s issue is not simply a repeat of an attack on oil facilities. The main concern is whether Saudi Arabia’s production and export infrastructure can continue operating without disruption.

This is precisely what makes recent developments involving Aramco particularly significant for the oil market.

What Do the Recent Attacks on Aramco Mean for the Global Oil Market?

Recent developments indicate that concerns about Saudi Arabia’s energy security are no longer limited to oil production facilities. On October 13, 2026, Aramco’s headquarters in Dhahran was targeted in an attack. Reuters reported that Saudi Arabia’s energy ministry described a limited fire in an administrative building and said there were no casualties. In a follow-up report on October 14, Reuters cited sources describing more extensive damage, while reporting that operations at the complex continued normally.

In the following days, the Houthis also claimed attacks on Aramco facilities in Yanbu, the Rabigh refinery and pumping stations along the East-West Pipeline. Reuters reported on October 26 that Saudi Arabia had not confirmed those claims. The same report said the pipeline had been temporarily shut in September as a precaution after a separate drone attack, and that the Strait of Hormuz had been largely shut by the war. Reported threats, precautionary shutdowns and verified physical damage should therefore be distinguished.

Why Are Threats to Export Routes More Important Than Disruptions to Oil Production Alone?

The key point is that producing oil is not enough to supply the global market. Oil must also be transported through pipelines and export terminals to reach buyers.

To reduce its dependence on the Strait of Hormuz, Saudi Arabia uses the East-West Pipeline. This route transports oil from production areas in the eastern part of the country to the port of Yanbu on the Red Sea coast.

Now imagine that this route is also disrupted. Even if oil wells remain operational, transporting crude to international customers could become more difficult.

Therefore, the market’s main concern is not just a decline in oil production, but also the possibility of disruptions to its transportation and exports. This alone could push oil prices higher, even before an actual supply shortage occurs.

How Could the Strait of Hormuz Change Global Oil Prices?

One of the biggest concerns surrounding global energy security is the oil market’s dependence on the Strait of Hormuz. According to data from the International Energy Agency, nearly 20 million barrels of crude oil and petroleum products passed through this route daily in 2025, equivalent to approximately one-fifth of global oil consumption.

The importance of the Strait of Hormuz becomes even clearer when we consider that major energy exporters such as Saudi Arabia, Iraq, Kuwait, Qatar and the UAE depend on this route for a significant share of their exports. China, India and Japan are also among the largest buyers of oil transported through the strait.

Is There an Alternative Route to the Strait of Hormuz?

To reduce its dependence on the Strait of Hormuz, Saudi Arabia operates a pipeline known as the East-West Pipeline. It transports oil from production areas in the eastern part of the country to the port of Yanbu on the Red Sea coast.

The pipeline was originally designed to carry approximately 5 million barrels per day. In its first-quarter 2026 results, Aramco reported that the pipeline had ramped up to its maximum capacity of 7 million barrels per day. However, nominal capacity is not the same as the volume that can be transported reliably and consistently.

There is one major limitation: this route cannot, on its own, replace all the oil transported through the Strait of Hormuz. Therefore, if both the Strait of Hormuz and alternative oil export routes are disrupted at the same time, replacing the lost supply would become considerably more difficult.

In other words, the oil market is not concerned only about production. Its main concern is whether the oil being produced can actually reach its destination.

This brings us to another important question: how could rising oil prices affect the economies of different countries and people's everyday lives?

How Do Rising Oil Prices Affect the Global Economy?

Higher oil prices do not always mean greater profits for oil-producing countries. At the same time, they can create opportunities for some producers while placing considerable economic pressure on energy-importing nations.

For example, in the United States, higher oil prices can increase the revenues of energy-producing companies. On the other hand, consumers have to pay more for petrol, transportation and everyday goods. This means that even the world's largest oil producer is not entirely immune to rising energy prices.

Why Are Oil-Importing Countries Under Greater Pressure?

Countries such as China, India and Japan meet a significant share of their energy needs through imports. When oil prices rise, their energy import costs increase as well. This can raise manufacturing, transportation and goods-import costs, placing additional pressure on their economies.

For this reason, rising oil prices are not simply an energy market issue; they can also affect economic growth in major economies.

The Relationship Between Oil Prices, Inflation and Interest Rates

One consequence that often receives less attention is the impact of higher oil prices on inflation.

Oil is not used solely to produce petrol. Many industries, transportation companies, factories and agricultural businesses depend directly or indirectly on energy. As a result, rising oil prices can increase production and transportation costs, eventually pushing up the prices of food and consumer goods.

These conditions also make central banks' jobs more difficult. If inflation rises again, interest rate cuts could be delayed. In certain circumstances, further rate increases may even be considered.

As a result, a disruption in Saudi Arabia’s oil industry could trigger a chain of economic consequences across different countries, from a higher cost of living for consumers to increased pressure on businesses and monetary policy.

But the key question remains: will higher oil prices persist, or will the market return to normal once tensions ease?

The Future of Oil Prices: Three Possible Scenarios for the Global Market

The future direction of oil prices depends primarily on the duration and severity of disruptions to energy infrastructure and export routes. To assess the market outlook, three main scenarios can be considered:

Scenario 1: Attacks Stop and Calm Returns to the Oil Market

If the attacks come to an end and Saudi Arabia’s production and export facilities continue operating without significant damage, some of the recent increase in oil prices is likely to be reversed.

Under these conditions, investors’ concerns about supply shortages would ease, and some of the price gains driven by geopolitical risks would gradually disappear from the market.

Scenario 2: Attacks Continue and Oil Prices Rise Gradually

If attacks on Saudi Arabia’s energy infrastructure continue, the oil market could face greater uncertainty, even without widespread production shutdowns.

Higher insurance costs for oil tankers, more difficult export operations and concerns about further attacks could keep oil prices at elevated levels. In this situation, Brent crude reaching the $130-per-barrel range could become a scenario worth considering.

Scenario 3: Widespread Disruptions to Production and Export Routes

This scenario could unfold if attacks extend beyond a limited number of facilities and both Saudi Arabia’s oil production and major export routes, such as the Strait of Hormuz and the Bab el-Mandeb Strait, experience serious disruptions at the same time.

Under such circumstances, several million barrels of oil could potentially be removed from global daily supply. If other producing countries are also unable to make up for the shortfall, oil prices could approach $150 per barrel.

These figures are not definitive forecasts. Rather, they are hypothetical price levels used to assess the potential consequences of an escalating crisis. The US Energy Information Administration (EIA) has also indicated that disruptions to export routes can intensify oil price volatility.

However, rising oil prices are only part of the story. Saudi Arabia faces another important challenge: Aramco’s vulnerability could affect the country’s long-term economic plans, which are designed to reduce its dependence on oil revenues.

Aramco and Saudi Arabia’s Economic Future: Is Dependence on Oil Still a Major Risk?

Saudi Arabia has been working for years to reduce its economy’s dependence on oil revenues. This objective is one of the main pillars of Saudi Vision 2030, a programme aimed at creating more diverse sources of national income through the development of tourism, technology, industry, foreign investment and the private sector.

Despite economic progress, oil continues to play a significant role in government revenues and in financing Saudi Arabia’s major projects. According to the Saudi Press Agency’s summary of the 2025 Vision 2030 report, non-oil activities accounted for approximately 55% of the country’s gross domestic product (GDP), highlighting the progress made in economic diversification.

Aramco holds a particularly important position in this process. In addition to generating a substantial share of oil revenues, the company is one of the main sources of profits and financing for the Saudi economy. Therefore, any prolonged disruption to its production or exports could affect government revenues, domestic investment and the implementation of development projects.

Aramco, however, is not relying solely on crude oil sales to reduce its vulnerability. The company is also investing in refining, petrochemicals, gas and emerging energy sectors.

For this reason, Aramco’s security is not merely an oil industry issue; it is also directly connected to Saudi Arabia’s economic stability and development plans.

Conclusion: What Factors Will Determine the Future of Oil Prices?

Developments involving Aramco demonstrate that oil prices are influenced by more than just production levels and global demand. The security of oil facilities, transportation and export routes, and geopolitical tensions can also change the direction of the market.

For investors, the important point is that rising oil prices do not always represent an investment opportunity. Alongside the potential for higher revenues among energy companies, investors must also consider the risks of supply disruptions, rising costs and market volatility.

Ultimately, the main question is not simply whether oil prices will reach $130 or $150 per barrel. It is whether the global economy is sufficiently prepared to withstand another energy shock.

Making informed decisions in financial markets requires examining developments in the oil sector, the performance of companies such as Aramco and broader global economic conditions together.

At Dar Al Tharwah, we believe that making sound financial decisions depends on a thorough understanding of economic developments and a careful assessment of both opportunities and risks. Changes in oil prices and the performance of major companies such as Aramco can create new investment opportunities, but taking advantage of them requires a clear understanding of market conditions and geopolitical implications. Our approach focuses on helping investors make informed decisions, manage risk and develop financial strategies aligned with their long-term goals.