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Saudi LPG facility targeted in Houthi attack: Update

  • Market: Crude oil, LPG, Oil products
  • 20/03/22

Adds comment from Houthi spokesman and Aramco CEO

Yemen's Houthi rebel group launched a ballistic missile and drone strike early Sunday that targeted an LPG facility operated by state-controlled Saudi Aramco in the Red Sea port city of Yanbu, the Saudi-led military coalition fighting the rebel group said.

The Houthis also targeted the city of Jizan, as well as an electricity transmission station in Dhahran al-Janub, less than 20km north of the Saudi-Yemen border, and a facility operated by the country's largest LPG distributor, state-owned Gasco, in the southwestern city of Khamis Mushait.

Jizan is home to a new Aramco-operated 400,000 b/d refinery complex that is currently being commissioned.

Saudi Arabia's air force and air defence systems intercepted and downed a ballistic missile that was targeting Jizan, as well as nine "booby-trapped drones" that were launched towards the other cities, said the coalition's spokesman, Brigadier General Turki al-Maliki.

The strikes resulted in "material damage to civilian vehicles and residential homes," but there was no loss of life, the coalition said.

The Houthis claimed responsibility for the attack soon after, with the group's military spokesman Yahya Saree saying in an announcement at 11:00 local time (08:00 GMT) that it had carried out the strikes using a "batch of ballistic and winged missiles, as well as drones."

The offensive came just ahead of Aramco's 2021 financial results announcement today in which it announced a more-than-doubling of its profits year on year.

Aramco chief executive Amin Nasser did not detail the extent of the damage at any of the targeted facilities, saying only that there had been "no injuries, and no impact" on the company's supply to its customers as a result of the attack.

This latest incident also comes around one week after its 126,000 b/d Riyadh refinery was targeted by drones early on 11 March, resulting in a small fire.

The Houthi group claimed responsibility for that attack in the hours that followed and said it had also targeted other Aramco facilities in Jizan and Abha. Saree today described the events of 11 March as "the first phase" of the operation that took place today.

Saudi Arabia has faced frequent attacks by the Houthis in neighbouring Yemen in recent years. Riyadh has supported Yemen's internationally-recognised government in the country's civil war, but says it prioritises efforts to reach a ceasefire.

The Houthi group last week rejected an invitation from the Gulf Co-operation Council (GCC) to attend talks on the conflict scheduled for 29 March — something al-Maliki highlighted in his statement today.

"These barbaric attacks represent a dangerous escalation and express the position of the terrorist Houthi militia towards the invitation submitted by…the Gulf Co-operation Council (GCC) to host consultations between all Yemeni parties and confirms its approach that it rejects all international efforts and initiatives," he said.

A spate of attacks by the Houthi group last month prompted US president Joe Biden to call Saudi King Salman bin Abdulaziz and vow to defend Saudi Arabia against future attacks from the rebels.


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07/05/25

IMO GHG pricing falls short on green methanol, ammonia

IMO GHG pricing falls short on green methanol, ammonia

New York, 7 May (Argus) — The International Maritime Organization's (IMO) proposed global greenhouse gas (GHG) pricing mechanism might not drive significant uptake of green methanol and green ammonia by 2035, given current market prices. Despite introducing penalties on high-emission fuels use and tradable surplus credits for low-emission fuels, the mechanism does not sufficiently close the cost gap for green alternatives. Under the system, starting in 2028 ship operators will face a two-tier penalty: $100/t CO₂e for emissions between the base and direct GHG intensity limit, and $380/t CO₂e for those exceeding the looser base limit. These thresholds will tighten annually through 2035. Ship operators can earn tradable credits for overcompliance when their GHG emissions fall below the direct limit. Assuming a surplus CO₂e credit value of $72/t — mirroring April 2025's average EU emissions trading system price — green ammonia would earn about $215/t in surplus credits in 2028 (see chart) . This barely offsets its April spot price of $2,830/t VLSFO equivalent in northwest Europe. Bio-methanol would receive about $175/t in credits, offering minimal relief on its $2,318/t April spot price. Currently, unsubsidized northwest Europe bio-LNG sits mid-range among bunker fuel options under IMO's emissions framework. While more expensive than HSFO, grey LNG, and B30 bioblends, the bio-LNG is cheaper than B100 (pure used cooking oil methyl ester), green ammonia, and bio-methanol. To become cost-competitive with unsubsidized bio-LNG — priced at $1,185/t in April 2025 — green ammonia and bio-methanol prices would need to fall by 57pc and 49pc, respectively, to around $1,220/t VLSFOe and $1,180/t VLSFOe by 2028. Unless green fuel prices drop significantly or fossil fuel prices rise, the IMO's structure alone provides insufficient economic incentive to accelerate green ammonia and bio-methanol adoption at scale. By Stefka Wechsler NW Europe, fuel prices plus IMO penalties and credits Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Opec+ eight agree accelerated hike for June: Update


07/05/25
News
07/05/25

Opec+ eight agree accelerated hike for June: Update

London, 7 May (Argus) — A core group of eight Opec+ members has agreed to accelerate, for a second consecutive month, their plan to unwind some of their production cuts, the Opec secretariat said Saturday. As it did for May, the group will again raise its collective output target by 411,000 b/d in June, three times as much as it had planned in its original roadmap to gradually unwind 2.2mn b/d of crude production cuts by the middle of next year. The original plan envisaged a slow and steady unwind over 18 months from April, with monthly increments of about 137,000 b/d. But today's decision means that the eight — Saudi Arabia, Russia, the UAE, Kuwait, Iraq, Algeria, Oman and Kazakhstan — will have unwound almost half of the 2.2mn b/d cut in the space of just three months. The decision to maintain this accelerated pace into June is somewhat surprising, given the weakness in oil prices and the outlook for the global economy. The eight's decision last month to deliver a three-in-one hike in May was seen as a key reason for the recent slide in oil prices, alongside US President Donald Trump's tariff policies. Front month Ice Brent futures have fallen by about $13/bl since early April to stand at just over $61/bl. But the eight today pointed to "current healthy market fundamentals, as reflected in the low oil inventories" as a key factor in its latest decision. It reiterated, as it has in the past, that the gradual monthly increases "may be paused or reversed subject to evolving market conditions." As was the case for May, delegates said that the main driver for the June hike was again a desire to send a message to those countries that have persistently breached their production targets since the start of last year — most notably Kazakhstan and Iraq, which each have significant overproduction to compensate for through the middle of next year. "This measure will provide an opportunity for the participating countries to accelerate their compensation," the secretariat said. This group of eight is due to next meet on 1 June to review market conditions and decide on July production levels. By Nader Itayim, Aydin Calik and Bachar Halabi Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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India, Saudi Arabia plan two Indian refineries


07/05/25
News
07/05/25

India, Saudi Arabia plan two Indian refineries

Mumbai, 7 May (Argus) — India and Saudi Arabia are to collaborate on the development of two integrated refinery and petrochemical plants in India. The plan was announced after Indian prime minister Narendra Modi met Saudi counterpart Mohammed bin Salman in Jeddah on 22 April, as part of the India–Saudi Arabia Strategic Partnership Council. Saudi Arabia in 2019 pledged to invest $100bn in India in several sectors including energy and petrochemicals. No further details have been provided but the projects could be Indian state-run BPCL's planned facility in Andhra Pradesh and oil firm ONGC's refinery project in Gujarat, according to industry participants. Plans for a 1.2mn b/d refinery in Ratnagiri alongside the UAE's Adnoc have been abandoned because of logistical and land acquisition challenges, industry participants say. Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Spanish base oils under force majeure after power cut


07/05/25
News
07/05/25

Spanish base oils under force majeure after power cut

London, 7 May (Argus) — Spanish firm Repsol declared force majeure on its domestic base oil operations last week, the day after a massive power outage disrupted industrial infrastructure across the Iberian peninsula, the company told Argus today. Repsol has since resumed production at its Spanish base oil plants, but the force majeure remains in place. Its duration will depend on how successfully output can be ramped up and whether the base oil material meets quality specifications, the company said. The nationwide blackout disrupted operations at Repsol's 80,000 t/yr Group I unit in Puertollano and its 135,000 t/yr Group I and 630,000 t/yr Group II and III units in Cartagena. It shares the Cartagena units in a joint venture with South Korean producer SK Enmove. The power outage in Spain has further tightened already constrained global Group III supplies. Bahrain's state-owned Bapco is carrying out a 45-day turnaround at its 400,000 t/yr Group III unit in Sintra, and SK Enmove is poised to start maintenance at its 1.3mn t/yr Groiup III plant in Ulsan, South Korea in mid-May. Europe is a net importer of Group III product, with only 13pc of the region's estimated 7mn t/yr of nameplate base oil production capacity dedicated to the higher-quality grade. Tight supply, combined with seasonally high finished lubricant demand due to the spring oil change, is likely to continue to support Group III prices. By Christian Hotten & Gabriella Twining Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Asian airlines divert, cancel flights to avoid Pakistan


07/05/25
News
07/05/25

Asian airlines divert, cancel flights to avoid Pakistan

Singapore, 7 May (Argus) — Asian airlines have announced diversions or cancellation of flights to avoid the Pakistani airspace, against the backdrop of escalating tensions between India and Pakistan. Most regional airlines' flights have been avoiding the airspace above Pakistan and neighboring west India regions since 6 May, according to data from FlightRadar24. Just a handful of flights flew over Pakistan shortly after Pakistan's Airports Authority issued a safety notice to pilots, known as Notam, announcing the reopening of airspace over Lahore and Karachi on 7 May. Pakistan announced a 48-hour closure of its airspace on 6 May, suspending all domestic and international flights following India's attacks on nine targets in Pakistan . India's flag carrier Air India has cancelled all its flights to and from domestic stations including Jammu, Srinagar, Leh, Jodhpur, Amrisar, Bhuj, Jamnagar, Chandigarh and Rajkot, until at least noon of 7 May. Singapore Airlines Group's Singapore Airlines (SIA) and budget arm Scoot have also been avoiding Pakistani airspace and using alternative flight paths since 6 May, according to the group. Two major Taiwanese airlines also announced their protocols in response to the situation. Taiwan's Eva Air said on 7 May that flights to and from Europe region might be influenced because of the closure of Pakistan's airspace. Fellow Taiwanese airline China Airlines have also cancelled or diverted at least six flights between Taiwan and Europe since 6 May in response to the escalating tensions. Escalating conflicts could cause prolonged disruptions on flight schedules between the Middle East and Pakistan, as well as between Asia and Europe. This comes at a time when regional airlines are already negatively impacted by flight disruptions in the Middle East . Pakistan is a typical jet fuel importer in South Asia. The country has imported around 6,600 b/d jet fuel in the first quarter of 2025, according to Pakistan's Oil Companies Advisory Council (OCAC). Pakistan's state-owned PSO has a market share of 99pc of the country's jet fuel market. By Lu Yawen Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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