After attacks on two major Saudi facilities, how reliant is the world on the kingdom’s oil?

There is a narrow issue and a broader one: what this means for Aramco and what the world should do about lower carbon emissions

The blow is stunning. The attacks on Saudi oil facilities have knocked out half of Saudi Arabia’s oil production. The kingdom is the world’s largest oil exporter. The state-owned company that produces the oil, Aramco, is probably the world’s most valuable enterprise. And oil provides one-third of the world’s primary energy.

It is hard to think through the global ramifications of an event such as this, because we know so little about the attack, about the likely political and military response to it, and about the practical implications for both Saudi Arabia, and more important, the world economy. But some points are already clear and it is worth setting them out.

For a start, a lot depends on how quickly production can be resumed. Assuming there are no further attacks, it should be possible to get some of the damage repaired reasonably swiftly – a matter of weeks. The oil fields themselves, including the giant Ghawar field, the world’s largest, are not touched. It is the processing plants that have been damaged. Further, this comes at a time where there is spare capacity in the oil market. Even if there weren’t, US shale production could be increased quite swiftly.