The weekend's attacks on Saudi Arabian oil facilities have led to massive supply disruptions. Futures for Brent crude, which serves as the international benchmark for oil prices, have surged during trading Monday following the drone strikes that hit half of the kingdom's oil output. Oil prices have spiked up 10%. It is unclear how far reaching this attack will be longterm on global oil prices and trading.
Here's how the U.S. Market settled today:
S&P 500 Index (SPY): -0.31% or 9.43 points
Dow Jones Industrial Average (DIA): -0.52% or 142.70 points
NASDAQ Composite Index (QQQ): -0.28% or 23.17
The attack on Saudi Arabian oil facilities on Saturday have destroyed about 5% of the country's global crude oil output. The drone strike led President Donald Trump on Sunday to authorize a release of crude oil from the U.S. Strategic Petroleum Reserve (SPR), which will offset the expected negative affect on the U.S.'s oil supply. The SPR is an emergency fuel storage of petroleum maintained underground by the United States Department of Energy and has the capacity to hold up to 727 million barrels, making it the largest emergency supply of oil in the world.
The attacks follow Saudi Arabia's oil company, Aramco, preparing to propose an initial public offering that would the largest publicly traded oil companies in the world. The measures taken against on the country's reserves puts the oil company in an odd place when it comes to global trading and investor trust.
In stock news, energy stocks have increased following the attack. Shares of Devon Energy (NYSE:DVN), Marathon Oil (NYSE: MRO), Exxon Mobil (NYSE: XOM), and Chevron (NYSE: CVX) have all seen gains following the increase in oil prices.
General Motors (NYSE: GM) was in the news today following the strike of over 48,000 United Auto Workers union members after their contract demands deadline was not met. It is unclear how long the strike will be in effect. The outcome of the settlement between the two will affect how the UAW will move forward with their extended contracts with Ford Motor Company (NYSE: F) and Fiat Chrysler Automobiles (NYSE: FCAU).
Tomorrow's U.S. market summary will follow the ongoing developments around global oil prices as trading countries continue to react to the Saudi Arabia's loss of oil reserves.