U.S. official says Washington believes Saudi attacks came from southwest Iran

WASHINGTON/DUBAI (Reuters) – The United States believes the attacks that crippled Saudi Arabian oil facilities last weekend originated in southwestern Iran, a U.S. official told Reuters on Tuesday, giving an assessment that further increases tension in the Middle East.

Three officials, speaking to Reuters on condition of anonymity, said the attacks involved both cruise missiles and drones, indicating that they involved a higher degree of complexity and sophistication than initially thought.

The officials did not provide evidence or explain what U.S. intelligence they were using to make the evaluations. Such U.S. intelligence, if it could be shared publicly, could increase pressure on Washington, Riyadh and others to respond, perhaps even militarily.

Iran denies involvement in the strikes. Iran’s allies in Yemen’s civil war, the Houthi movement, claimed responsibility for the attacks. The Houthis say they struck the plants with drones, some of which were powered by jet engines.

U.S. President Donald Trump on Monday said it looked as if Iran was behind the attacks.

Saudi Arabia sought to reassure markets after the attack on Saturday halved oil output, saying on Tuesday that full production is now back.

Iranian Supreme Leader Ayatollah Ali Khamenei on Tuesday ruled out talks with the United States unless the Trump administration returns to the nuclear accord between Iran and the West that the United States abandoned last year.

“Iranian officials, at any level, will never talk to American officials … this is part of their policy to put pressure on Iran,” Iranian state TV quoted him as saying.

U.S.-Iran relations deteriorated after Trump quit the nuclear pact and reimposed sanctions over Tehran’s nuclear and ballistic programs, severely hurting the Iranian economy. Trump also wants Iran to stop supporting regional proxies, including Yemen’s Houthis.

Iran’s clerical rulers openly support the Houthis, who are fighting a Saudi-led coalition in Yemen, but Tehran denies that it actively supports the Yemeni group with military and financial support.

SAUDI OIL BACK

Saudi Arabia’s oil production is fully back online after the attacks and the kingdom will achieve 11 million barrels per day (bpd) capacity by the end of September and 12 million bpd by the end of November, the energy minister said on Tuesday.

Minister Prince Abdulaziz bin Salman also told a news conference that oil production in October would be 9.89 million bpd and that the world’s top oil exporter would keep full oil supplies to customers this month.

He said Saudi Arabia would keep its role as the secure supplier of global oil markets, adding that the kingdom needed to take strict measures to prevent further attacks, which exposed the vulnerability of Saudi Arabia’s oil industry and the broader global economy.

Oil prices fell 5% after the news that Saudi production is back, having surged more than 20% at one point on Monday – the biggest intra-day jump since the 1990-91 Gulf crisis over Iraq’s invasion of Kuwait.

A day after warning that the United States was “locked and loaded” to respond to the Saudi incident, Trump dialed down his rhetoric, saying on Monday there was “no rush” to do so and that Washington was coordinating with Gulf Arab and European states.

“I’m not looking at options right now. We want to find definitively who did this,” Trump said.

Secretary of State Mike Pompeo was traveling to Saudi Arabia on Tuesday.

German Chancellor Angela Merkel said the Iran nuclear pact, which European parties are trying to salvage, is one building block “we need to get back to”.

Saudi Arabia, which has supported tougher U.S. sanctions on Iran, said an initial investigation showed the strikes were carried out with Iranian weapons.

Galip Dalay, a non-resident fellow at the Brookings Doha Center think tank, said the sophistication of the attacks and the fact such an operation would require high-level approval pointed at Tehran.

“Iran is essentially saying, ‘If I can’t get my oil into international markets, then no one should be able to do it’,” he said. “They are basically looking to destabilize an international market that they have been cut out of by U.S. sanctions.”