UAE Gas Field Hit, Key Oil Hub Halts as Energy Attacks Intensify

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(Bloomberg) — A large gas field in the United Arab Emirates was set ablaze after a drone strike and a vital oil port was halted again, piling pressure on energy markets and supply with each day that the Iran war goes on.

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The latest incidents in the UAE add to a fast-growing list of attacks on energy assets in the Middle East. Some of the largest refineries and a massive LNG export plant have halted following drone strikes, ports around the region have been hit and oil fields in Saudi Arabia targeted. 

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The intensifying strikes by Iran are reverberating through markets and economies worldwide, with consumers from the Americas to India and Japan feeling the pinch. The near shutdown of the Strait of Hormuz has helped drive crude oil prices to above $100 a barrel and risk to the global economy from rising inflation is mounting.

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Also read: US Diesel Tops $5 a Gallon as War Disrupts Fuel Supply Chains

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In the UAE, the hit on the big Shah gas project is the first on a producing field in the country. Abu Dhabi authorities brought the blaze under control at the high-sulfur gas field in the Empty Quarter desert west of the Emirate, according to the media office. Operations were halted and no injuries reported.

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The attack on Shah comes a year after US Energy Secretary Chris Wright visited the field as part of his trip to the region. It’s operated by a joint venture of Abu Dhabi National Oil Co. and US firm Occidental Petroleum Corp., and lies in the UAE’s portion of the vast Empty Quarter desert, where Saudi Arabia’s Shaybah field is also located and which has been repeatedly targeted. Shah has the capacity to produce about a fifth of the UAE’s total gas and large amounts of sulfur, according to Adnoc’s website and Energy Institute data.

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In Iraq, across the Persian Gulf, the Majnoon oil field was also targeted, according to a Iraqi oil ministry statement that didn’t provide additional details.

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Fujairah Halt

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The UAE’s key port of Fujairah suspended loadings again on Tuesday after some operations resumed briefly the previous day, according to a shipping agent and a person familiar with the matter. The port has been repeatedly targeted in the war, with the latest attacks coming after a warning from Iran’s military on Saturday that Fujairah and other UAE ports of Jebel Ali and Port Khalifa had become legitimate targets due to the presence of US military forces in civilian facilities, the semi-official Fars news agency had reported.

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Loading berths at the Fujairah Oil Tanker Terminals, which handles liquid cargo including fuels, were halted as of Tuesday morning, according to a note from Inchcape Shipping Services. A terminal operated in a joint venture with Dutch firm Koninklijke Vopak NV has also suspended operations at its offshore mooring point, according to the note.

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That’s a change from a report Monday evening that said the Oil Tanker Terminals were partially operational. A person close to the development had also said that crude oil loadings from Adnoc at the port remained suspended.