Aramco Oil Refinery Attacked by Houthi Drone, Iran Sets Conditions for Opening Strait of Hormuz

Firefighters successfully extinguished a blaze that engulfed an oil refinery owned by Saudi energy giant Aramco on Sunday morning local time. The incident occurred amid claims of an attack by Iran-backed Houthi rebels in Yemen.

Saudi Arabia’s Ministry of Energy confirmed via a statement on platform X that relevant authorities were completing the necessary procedures to handle the incident at the Aramco refinery located in Jazan. The government assured that there were no casualties in the event, although it did not detail the exact cause of the fire.

The Houthi group reportedly claimed responsibility for the attack. Through the Iranian government-backed Mehr news agency, the Yemeni Armed Forces stated that they had attacked the Aramco refinery in Jizan with precision drones. They described the action as retaliation for violations of Yemeni airspace by Saudi drones.

As of now, the claim has not been independently verified. However, the Houthis have repeatedly targeted Aramco facilities since the conflict erupted in the region.

Amid the escalation of physical attacks, diplomatic tensions between Iran and the United States also continue to heat up. Iranian Foreign Minister Abbas Araghchi stated that there are currently no direct talks with the US. Communication is only conducted through intermediaries, with Oman serving as the main mediator.

The main focus of current negotiations is the reopening of the Strait of Hormuz, a vital passage that channels one-fifth of the world’s energy supply. Araghchi stressed that the opening of the strait depends on certain conditions conveyed through mediators.

Iran and Oman are reportedly working towards a transit route agreement, whereby inbound traffic would pass through Iranian waters and outbound traffic through Omani waters. However, the Iranian parliament is reviewing a draft plan that would ban US and Israeli vessels from transiting the strait.

The uncertainty has had a direct impact on global markets. Data from Kpler showed that ship traffic through Hormuz fell by 33% on Friday compared with the previous day. This condition has triggered a rise in global crude oil prices.

Brent crude closed up more than 1% at US$83.55 per barrel, while US West Texas Intermediate rose to US$78.18 per barrel. Despite strengthening at the end of the week, oil prices overall fell by more than 7% over the past week as investors awaited certainty on a deal in the region.