Drone Attack and Oil Prices

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Iran denies a recent drone attack on Saudi Arabia, as the strikes halve Saudi oil facility output, and President Trump vows to tap U.S. oil reserves.

Questions:

  1. What has happened to oil futures as a result of the attack?
  2. How is the Pentagon weighing in on the latest conflict?
  3. What was Secretary of State Mike Pompeo’s response?
  4. Discuss the Saudi production of oil and the significant effect that it may have on prices at the gas pump.

Source: Fahim, K., A. Gearan, E. Cunningham, and S. Mufson. (2019). Iran denies role in attacks on Saudi oil facilities; Trump says U.S. is ‘locked and loaded.’ The Washington Post, Sep. 15 (Retrievable online at https://www.washingtonpost.com/world/iran-dismisses-allegations-it-carried-out-crippling-attack-on-saudi-oil-facilities/2019/09/15/021b6822-d731-11e9-8924-1db7dac797fb_story.html)