Overview
Melius Research, citing an extended shutdown of the Jizan refinery and power plant in Saudi Arabia, expects oil prices to climb.
Facility Details
The Jizan complex, which combines a 400,000‑barrel‑per‑day petroleum refinery with an adjoining power plant that supplies electricity to the local grid, has been out of operation for six weeks.
Market Impact
Melius says the loss of 400,000 bpd of refining capacity adds pressure to an already constrained international oil market. U.S. fuel stockpiles remain depleted, and Brent crude futures have risen to approximately $98 per barrel.
Geopolitical Context
The research firm links the price environment to escalating conflicts in the Gulf region, noting that security threats are extending critical maintenance periods beyond the duration of historical isolated incidents at facilities such as Abqaiq and Ras Tanura.
Outlook
Accordingly, Melius anticipates further upward pressure on oil prices as the Jizan shutdown persists and global supply constraints continue.