Fear has grasped the Western world and expats working in the oil-rich Saudi kingdom following the weekend attack in Khobar as Saudi Arabia is doing its utmost to alleviate concerns regarding security in the kingdom and oil prices.
Despite the Saudi Arabia's repeated assurances, analysts are expected to be troubled for the time to come. Experts claim recent attacks on oil facilities and compounds in the kingdom could have a devastating impact on the oil market.
Saudi Arabia, the world’s biggest oil producer, relies heavily on thousands of expatriate workers to run its oil industry and other central economic sectors.
In the second major attack on the oil industry in just less than a month, the gunmen on Saturday sprayed gunfire at Western oil firms. Osama bin Laden's Al Qaeda network claimed the attack.
The attackers opened fire at the Al-Khobar Petroleum Center building, believed to house offices of major Western oil firms, before storming into compounds containing oil services offices and homes of employees.
One of the targeted oil industry compounds contains offices and apartments for the Arab Petroleum Investment Corporation, or Apicorp, and the other - the Petroleum Center building - houses offices of various international firms. In addition to Apicorp, oil industry companies with offices in the compounds include a joint venture among Royal Dutch/Shell Group, Total SA and Saudi Aramco; Lukoil Holdings of Russia; and China Petroleum & Chemical Corp., or Sinopec.
Oil markets have been on edge over the possibility of a "militant strike" disrupting oil supplies, and the situation in the Kingdom has already helped push prices to over $40 a barrel.
Home for most of the expats is in large, high-walled luxury compounds with their own blocks of homes, restaurants, supermarkets, schools and swimming pools. The compounds have always served a dual purpose, providing "safe havens" for the residents and a barrier that shields Western lifestyles from the largely Muslim local population.
But where the compounds once resounded to the sounds of family life, they have now become mini-fortresses with an increasingly besieged male population.
Residents are told to check under their cars when they leave and vary their routes to work. Some only go out in armoured buses.
A Western security expert was cited as saying that despite the raised security levels, office blocks and residential compounds were still seen as the "softest" targets.
In recent weeks, increasing numbers of foreign workers have decided to send their families back home.
A British operations manager for oil giant Saudi Aramco, was quoted as saying, "Expats working here are getting scared and they are leaving."
Saudi Aramco’s chief executive has sought to calm Western fears over oil supplies and said the Saudi Kingdom’s oil fields and facilities are "well-protected".
"Our company has 5,000 security guards to protect oil facilities, in addition to the state security forces deployed around them," Abdullah Jumah said at the Royal Institute of International Affairs in London.
"Land, marine and border forces are involved in the security operation to prevent terrorists and saboteurs from reaching oil facilities on land and sea," Al-Hayat daily quoted him as saying last week.
Jane's Intelligence Review has recently reported that over the past two years, the Saudi government has directed an extra $750 million to boost security at all of its oil installations as the risk of attack has increased.
Jumah said Aramco had always met oil market requirements on time and Riyadh would have no trouble producing 12 to 15 million barrels a day.
However, the Kingdom had no desire to replace Iraqi oil on the market. "We don’t want to supply oil in place of Iraq. We want Iraq’s production to play its role in supporting its economy as well as world economies," the Aramco chief said.
Meanwhile, in a previous statement Jumah downplayed the shooting rampage in a petrochemical complex in Yanbu earlier this month that killed five Western engineers and a National Guard officer.
Saudi Aramco said in the aftermath of the Yanbu attack it had "not been affected" by the incident and that operations were continuing as normal at all its facilities.
"These are individual" incidents, Jumah said of the Yanbu attack.
"It is unfortunate that they happen. We cannot take one incident and say that this situation (applies) all over the Kingdom," he said.
"In terms of the security of our people and our facilities, we... have always been active... We have a huge security organization in the Kingdom," Jumah said.
Saudi Aramco employs an estimated 54,000 people, including around 2,300 US and Canadian citizens and about 1,100 Europeans. (menareport.com)
© 2004 Mena Report (www.menareport.com)
