Morning Highlights: Aramco’s Dhahran Headquarters Hit as IEA Warns Diesel Tightness Will Run Into 2027

Wednesday, October 14, 2026 | 6:45 AM ET

Brent (December) $106.43 | WTI (November) $95.27

Brent +$0.74 (+0.7%), WTI +$1.13 (+1.2%). A Houthi missile hit an office tower in Saudi Aramco’s headquarters complex in Dhahran on Tuesday, causing a limited fire and no injuries, per the Saudi energy ministry. Iranian officials told Reuters they are using new tactics against shipping, and the IEA said in its October report that diesel markets will stay tight well into 2027.

Bottom Line

The Dhahran strike is the first reported hit on an Aramco corporate site in this round of attacks, and it hit a command center, not a producing or export asset. A company source told Reuters a ballistic missile struck the complex and damaged the top three floors of an office tower. Dhahran houses a major operations center that oversees Aramco’s onshore and offshore rigs, pipelines, refineries and export terminals. The Houthis said they launched ballistic missiles, cruise missiles and drones at Aramco facilities in Dhahran, King Khalid International Airport and an Aramco refinery in Riyadh, without saying when. Only the Dhahran strike is confirmed. They declared airports and oil facilities legitimate targets and urged shipping companies, civilians and workers to evacuate them. The Saudi-led coalition said it intercepted a ballistic missile fired at Riyadh on Wednesday, and Riyadh’s airport, hit four times, is closed until October 17. UBS’s Giovanni Staunovo said attacks on ships and the Saudi-Houthi strikes are supporting prices because of concern about lower regional exports, and that exports have held up so far.

Iranian officials told Reuters they have shifted tactics against shipping, with one saying the new approach began about 10 days ago. They declined to give details, and said the aim is to keep oil prices high and influence the US midterms. Phillip Nova’s Priyanka Sachdeva said the open admission “speaks volumes about the real intentions behind the so-called ‘peace talks.’” The UK Maritime Trade Operations agency reported Tuesday that a container ship and a tanker were hit by unknown projectiles inside Hormuz. On Wednesday the Revolutionary Guards Navy said a container ship sank south of the strait after hitting a mine and catching fire, per state media. Reuters has not confirmed that account.

The IEA’s October report, published today, puts numbers on how lopsided the recovery is. Gulf crude exports rose 4.4 million bpd in September to 13.9 million, over 75% of pre-war levels, with flows through Hormuz up 3.7 million bpd to 10.9 million and bypass routes up 970,000 bpd to 5.6 million. Product exports remain below half of pre-war: refined products reached 1.9 million bpd against 4.7 million before the war, and LPG 670,000 bpd against 1.5 million. The agency left its forecast for the rest of the year largely unchanged because of the October Houthi attacks, calling the rebound fragile. It puts Dated Brent at about $134 against Brent futures near $107, and said other North Sea grades have traded as high as $160, so physical buyers are paying well above the screen.

On diesel, the IEA says supply losses are outrunning weaker demand. Combined net gasoil exports from the Middle East and Russia fell 1.3 million bpd in September to 820,000 bpd, down more than 60% from a year earlier. Wholesale diesel topped $200 a barrel in Singapore in mid-September and reached about $220 in Europe and the US, and the agency says delivered prices in Europe, Africa and Latin America could rise again in the coming weeks. Gasoil is forecast to return to surplus in the first quarter of 2027, but not enough to offset 2026’s deficit, so stock replenishment is unlikely before the second half of 2027. The IEA also said Russia’s easing of diesel export restrictions is unlikely to change the global balance because the constraint is a lack of operating Russian refinery capacity. Nissan Securities’ Hiroyuki Kikukawa expects the expected Russian volumes to limit sharp moves in either direction. Chinese product exports, a key source of Asian supply this quarter, were helped by the resumption of export licences in recent days.

The demand side is weakening too. The IEA expects global demand to fall 2.5 million bpd year on year in the fourth quarter and 2.6 million bpd for 2026, to 102.4 million, with diesel making up 25% of the drop. A partial 2 million bpd recovery in 2027 would still leave demand 620,000 bpd below 2025. The balance stays in deficit through year-end. Global observed stocks are 509 million barrels below end-February, and on-land stocks are at their lowest since at least 2016. The agency warns more turmoil is possible before any surplus emerges in 2027.