*** Saudi Arabia's Abqaiq & Khurais oil.........>

OIL: *** Saudi Arabia's Abqaiq & Khurais oil facilities sustained heavy damage

Saturday (~5.7mn BPD, ~5% of global production affected). The Yemeni Houthi

rebel group claimed responsibility, pointing to the use of drones. Various

groups, including the U.S. gov't, have played down these claims, with some

pointing the finger at Iraq, but more prominently Iran. Both countries have

rejected these claims. Several gov'ts have pointed to the use of cruise

missiles, as opposed to drones, questioning the validity of the Houthi claims.

- Several source reports suggest the facilities may have 30-40% of output back

online Monday, with a risk that full production may not be seen for

weeks/months. Plenty of OPEC+ producers will be willing to fill the void,

although estimates of the group's spare productive capacity equates to ~50% of

the outage. Saudi has pointed to the use of its reserves to plug the holes in

exports. The IEA noted that global oil mkts are "well supplied with ample

commercial stocks" for now, while the U.S. is prepared to make releases from its

SPR. The attack reintroduces geopolitical risk premium, especially given the

recent "Bolton unwind," even more so if Iran is proven to be the orchestrator.