What happened on Saturday morning?

Saudi pipelines, oil installations and tankers have occasionally been attacked over the past two years, but analysts say what happened in eastern Saudi Arabia in the early hours of Saturday morning is a much larger escalation: a hit to the jugular of the kingdom’s oil industry.

At 3.31am and 3.42am on Saturday, loud explosions erupted at Khurais oilfield and Abqaiq processing facility, both owned by Saudi Aramco, the country’s state-owned oil company, often described as the kingdom’s crown jewel.

The explosions set off fires that took several hours to douse and appear to have caused significant damage. Saudi oil ministry sources said the production had been disrupted by about 5m barrels a day – nearly half the kingdom’s estimated output of 9.7m barrels and 5% of global production.

Facebook Twitter Pinterest A pre-strike satellite image of the Abqaiq oil processing facility, released by the US government and DigitalGlobe, and annotated by the source. Photograph: maldonci/AP

Who was responsible?

The Houthis, the Iran-aligned rebel army that has been fighting a Saudi-led military coalition in neighbouring Yemen for the past four years, claimed responsibility for the attack.

The Houthis recently acquired much more powerful drone technology that has given them the power to strike targets up to 1,500km away, according to the UN. Abqaiq is within about 1,000km of Houthi-held territory. In the past months, there have been unconfirmed reports of attacks by Houthi drones on civilian airports in Saudi Arabia, Abu Dhabi and Dubai.

But Saturday’s strikes would represent a marked increase in sophistication compared to those earlier attacks. Western and Saudi governments believe Iran has been assisting the Houthis to acquire and use the advanced drones – a charge both Tehran and the Yemeni rebels deny.

However, the US says there is no evidence the attack originated in Yemen and has squarely blamed it on Iran, seeing it as part of a pattern of threats to oil tankers and infrastructure in past months that it says Iran has carried out in response to sanctions on Iranian oil that are crippling the Islamic Republic’s economy.

The US government has produced satellite photos showing what officials said were at least 19 points of impact at the two Saudi energy facilities, including damage at the heart of the Abqaiq plant. Officials told US media the photos show impacts consistent with the attack coming from the direction of Iran or Iraq, rather than from Yemen to the south. Tehran says it had nothing to do with Saturday’s attack.

Facebook Twitter Pinterest A satellite image released by the US of the Abqaiq facility. US officials said it shows that the attack came from the north or north-west, but this photo appears to show damage on the west. Photograph: maldonci/AP

Why is this attack such a big deal?

Abqaiq is the world’s largest oil processing facility, where about two-thirds of the total Saudi supply is refined and cleaned of impurities such as sulphur and sand. “This is the heart of Saudi Arabia’s oil infrastructure,” said Homayoun Falakshahi, an oil and gas equity analyst at Kpler, a Paris-based energy data firm.

A facility of such importance was supposed to be insulated from the wider instability of the Middle East. “Because of its importance it is very well protected, under extremely high security measures,” Falakshahi said.

The fact that it can be severely disrupted is a sign that the world’s energy infrastructure is more vulnerable than previously believed, and considered a legitimate target.

How are the regional actors aligned?

The Houthis are regarded as part of a network of militias in the Middle East who are sponsored or assisted in some way by Tehran, part of a broader fight to dominate the Middle East between Iran and Saudi Arabia that dates back to the Iranian revolution of 1979. The pair do not directly clash; the battle is playing out through proxy actors in Syria, Lebanon and Yemen, among other countries.

Iran continues to deny that it materially assists the Houthis but has become more openly supportive this year, inviting a Houthi spokesman to Tehran where he was praised as a “holy warrior” by the country’s supreme leader, Ayatollah Ali Khamenei.

What has been the impact on oil prices?

News of the attacks jolted the financial markets, sending the oil price soaring. The price of a barrel of Brent crude surged by 20% early on Monday to nearly $72 (£58, up from $60 per barrel). That’s a huge jump – the biggest move since the contract was created in the 1980s.

It then dropped back to about $66 per barrel after Donald Trump pledged to release some of America’s oil reserves, to make up the shortfall from Saudi Arabia. That’s a two-month high, up 10% compared with Friday night.

Economists believe the oil price could rise higher if Aramco cannot bring supplies back online quickly, or if there is military action in the Gulf.

Higher oil prices can drag on global growth. It pushes up transport costs and the prices of petroleum-based products. This fuels inflation, leaving consumers with less disposable income.

Facebook Twitter Pinterest Fluctuations in the Brent crude oil price. Photograph: Refinitiv

What could happen next?

Trump says his government is “locked and loaded” and ready to respond to whoever carried out Saturday’s attack, hinting strongly that the US may see it as justification for a military strike on Iran.

Yet any such attack would carry a significant risk of escalation – a chance that Trump has previously been unwilling to take.

In the short term, the strikes appear to have scuttled any momentum towards Trump meeting with the Iranian president, Hassan Rouhani, when the latter arrives in New York next week for the opening of the 74th UN general assembly. Although with the mercurial US president in charge, that too could quickly change.