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Oil markets are grappling with uncertainty over how long it will take Saudi Arabia to restore output after the devastating attacks that knocked out 5% of global crude supply.
As state oil producer Saudi Aramco grows less optimistic that there will be a rapid recovery after the strikes that cut the nation’s output by half, investors are looking for clarity on just how bad it could be. Initially, it was said significant volumes could begin to flow again within days but Saudi officials later told a foreign diplomat they face a “severe” disruption measured in weeks and months.
“There’s been a real shift in understanding how quickly that lost production is going to come back online,” Ann Berry, a partner at Cornell Capital LLC, said in an interview on Bloomberg TV. “The original reaction was that 100% would come back very quickly, now the outlook is going to be a lot more conservative than that.”