Oil prices rose as much as 20 per cent to above $71.00 a barrel — the biggest percentage spike in almost three decades — as markets reopened after an attack on Saudi Arabia’s oil infrastructure at the weekend cut more than half the country’s production.

The rally, which followed news that Saudi Arabia’s oil production is expected to be well below maximum capacity for weeks, set oil on course for one of its biggest one-day gains as traders worried over the extent of the outage.

Brent crude oil, the international benchmark, gained almost $12 to trade as high as $71.95 a barrel, before easing back to $65.21 in the European morning, still up 8.5 per cent. The US benchmark, West Texas Intermediate, was up as much as 16 per cent to $63.64 a barrel before paring back these gains to $59.25, or 8 per cent up.

The attack on Saturday, which the US blamed on Iran, sharply increased risks in global energy markets. It also dented Saudi Arabia’s reputation as the most reliable supplier of last resort.

Saudi Arabia was ill-equipped to deal with the disruption amid new leadership at Saudi Aramco and the energy ministry and a looming IPO, Nick Butler writes. Read our Live blog.

In the news

Fed wrestles with trade war and Saudi oil attack
A potential oil shock will add to problems policymakers already face assessing economic risks. (FT)

Brexit talks
Boris Johnson will hold his first face-to-face talks with Jean-Claude Juncker, European Commission president, on Monday, with the British prime minister claiming he “passionately” believes a Brexit deal is possible. Wolfgang Munchau contends that an Italian-style coalition could stop Brexit. The changes in Rome hold lessons for Remainers — and for Mr Johnson. (FT)

Purdue claims bankruptcy
Purdue Pharma, the opioid maker owned by members of the Sackler family, has filed for bankruptcy, as it hopes to force holdout states to accept its offer to settle litigation that accuses it of helping cause the US opioid epidemic. (FT)

China’s slowdown
Growth in industrial output from Chinese factories fell to a fresh low in August, another signal that the trade war and slowing economic activity are weighing on the world’s second-biggest economy. Chinese companies have also become net sellers of global assets this year for the first time in a decade. (FT)

Havoc in Hong Kong
Pro-democracy protesters left a trail of destruction across Hong Kong on Sunday, marching in defiance of a police ban and vandalising government buildings and subway stations. The anti-government demonstrations have now lasted more than 100 days — and have a new anthem. (FT, Bloomberg)

An anti-government protester throws a Molotov cocktail during a demonstration near Central Government Complex in Hong Kong, Sunday, Sept. 15, 2019. Police fired a water cannon and tear gas at protesters who lobbed Molotov cocktails outside the Hong Kong government office complex Sunday, as violence flared anew after thousands of pro-democracy supporters marched through downtown in defiance of a police ban. (AP Photo/Vincent Yu)
Riot police used tear gas and water cannons on the crowds © AP

Frankfurt Motor Show stalls
The future of the world’s biggest motor show is in doubt after a weekend of environmental protests brought parts of Frankfurt, which has hosted the motor show since 1951, to a standstill. Meanwhile, BMW will not renew the i3, its primary electric vehicle. (FT)

HKEX charm offensive
Hong Kong’s bourse will step up efforts this week to buy the London Stock Exchange Group by appealing directly to shareholders, following the rejection on Friday of its £32bn offer. Our Big Read delves into the unsolicited bid, which is testing the LSE’s post-Brexit loyalties amid tensions with China. (FT)

Blackstone has clinched an all-cash takeover for Canadian real estate investment trust Dream Global, valuing the owner of western European office and warehouse spaces at C$6.2bn ($4.7bn). The acquisition adds to Blackstone’s expanding portfolio of logistics properties — the group’s property arm closed a record $20.5bn in commitments last week.

French hotel group returns to Syria
Louvre Hotel Group will manage two luxury hotels opening next year in Damascus, the first western company to return to Syria’s tourist industry since civil war broke out in 2011. (FT)

Days ahead

Coin questions
Facebook is set to be quizzed today on its proposed Libra coin project by global regulators after a weekend in which EU finance ministers meeting in Helsinki expressed concern about the financial stability implications of the project. Benoît Coeuré of the European Central Bank, who will chair the meeting, warned in Finland that “the bar for regulatory approval will be very high” for Libra to operate in the EU. (FT)

Apple and Ireland
Judges in Luxembourg will on Tuesday and Wednesday hear arguments in the court battle over the European Commission’s finding that Apple and Ireland created an “artificial” profit arrangement enabling the iPhone maker to pay a tax rate of less than 1 per cent. (FT)

What else we’re reading

Israel’s election kingmaker
As Israel goes to the polls on Tuesday for the second time in a year, former defence minister Avigdor Lieberman is wooing secular security hawks in a bid to fracture the rightwing vote — giving him power over the fate of Israel’s prime minister since 2009, Benjamin Netanyahu, who also faces a united Arab opposition. (FT)

US scepticism on climate change
Ahead of a UN climate summit next week, a YouGov poll shows the US is a clear outlier in terms of scepticism about climate change, with considerably more people expressing doubts than in Europe. Some 15 per cent of Americans believe either that the climate is not changing at all, or that it is not changing due to human causes, almost three times the global average. (FT)

Takedown is on the money
Rana Foroohar is not a big fan of shareholder “activists” like Paul Singer, but she thinks the letter his investment firm Elliott Management sent last week to AT&T’s board of directors couldn’t be truer. The telecoms group is an underperforming, mismanaged dodo bird of a company — big enough to have racked up $190bn in debt yet not large enough to fend off the Big Tech apex predators ready to eat its lunch, she writes. (FT)

Lunch with the FT
Pierre Lagrange, the 57-year-old Belgian maverick “hedgie” is a financial nerd: an engineer who made a fortune leading up to the financial crash and then in its aftermath. But his back-story is rather edgier: innovator, fashionista, iconoclast, Harley rider and more. And secretive his HQ certainly is. (FT)

Can Jamie Dimon’s magic touch weather the bad times ahead?
If the world’s big banks are riding for a fall, you wouldn’t know it to look at the biggest of them all, writes Patrick Jenkins. JPMorgan’s share price hit an all-time high of nearly $119 late last week, cementing its dominance of the world ranking by market capitalisation. The financial crisis was supposed to have killed off all the “masters of the universe” — Mr Dimon may be the last true example of the species. (FT)

Hidden M&A victims: staff
Many M&A deals take no account of the extreme human cost in disruption and anxiety, writes Andrew Hill (FT)

Channel Sky Atlantic Programme Billions Series 3 People Damian Lewis as Bobby “Axe” Axelrod and Asia Kate Dillon
Hostile takeovers: hedge funders Bobby Axelrod (Damian Lewis) and Taylor Mason (Asia Kate Dillon) in Sky/Showtime ‘Billions’ © Jeff Neumann/SHOWTIME

Notre-Dame’s toxic fallout
When flames engulfed the Notre-Dame in April, 460 tons of lead in the roof and spire were incinerated, scattering toxic dust on to the streets, schools and parks of Paris. Five months later, French authorities have not disclosed contamination testing results. Here are precautions to consider before visiting with children. (NYT)

Africa’s urbanisation ills
Urbanisation often conjures images of young professionals crammed into megacities, living in pods in ever-taller skyscrapers. But some 10m people are projected to flood into Lagos, Nigeria between 2020 and 2025, roughly 10 times the number of people who will become Londoners. Read more about the city’s response in our Special Report: How will we live in 2050? (FT)

The grandmaster diet
Training for top chess players now includes strict dietary and fitness regimens to avoid severe weight loss during tournaments, when their stress responses mirror other elite athletes: last year, 21-year-old Russian grandmaster Mikhail Antipov was estimated to have burnt 560 calories in two hours of competition — roughly the same as Roger Federer in an hour of tennis. (ESPN)

Sexist jokes are sadly not outliers
An unfortunate missive from CLSA’s Damian Kestel reinforced tedious, sexist clichés, but it was a reminder that while sensitivity to corporate sexism is improving, we still have a long way to go, Pilita Clark writes. (FT)

Richard Haas predicts that John Bolton’s successor will struggle to satisfy Donald Trump. The president of the Council on Foreign Relations argues from his own experience as National Security Council staff member that the next US national security adviser would be wise to focus on details. (FT)

Video of the day

Why sterling is on the rebound
The FT’s capital markets editor Katie Martin sees fading no-deal Brexit fears driving the pound’s recovery this week. (FT)

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