Saudi Arabia resumed operations on its East-West Pipeline following a drone strike that had disabled the crucial conduit, according to Reuters. The nation indicated it may begin loading crude at its Yanbu terminal on the Red Sea later in the day, a development that influenced crude markets significantly.
The pipeline serves as a critical alternative route to the Strait of Hormuz, which has faced disruptions from drone attacks, mines, and other maritime incidents. The facility transports approximately 4 million barrels daily across Saudi Arabia’s width to the Red Sea, representing roughly 4% of global petroleum consumption. The route allows this volume to bypass the Strait of Hormuz entirely. Brent crude declined to its lowest level since September 8 following the restart announcement.
However, the immediate resumption was partial rather than complete. State oil company Saudi Aramco indicated it was pumping at a reduced rate, with industry sources suggesting full restoration could require weeks. Security personnel were working to repair damage in Tabuk province, creating uncertainty about when the pipeline would return to full capacity.
Markets responded to the development despite the incomplete recovery. Tankers already began positioning themselves at Port Said and Sidi Kerir for potential ship-to-ship transfers in anticipation of resumed flows. Current fuel prices reflected the earlier supply disruptions, with gasoline trading around $4.48 compared to $3.18 a year prior, and diesel at $6.51 versus $3.70 previously. The duration and stability of the pipeline’s recovery remained contingent on ongoing security conditions and repair efforts.
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