Houthi Attacks Threaten Saudi Oil Pipeline Bypass

Saudi Arabia's East-West Pipeline (Petroline), built around 40 years ago and restored to its maximum capacity of about 7 million barrels per day in 2026, has proven a critical lifeline for moving crude from Eastern Province oil fields across the kingdom to the Red Sea port of Yanbu.

This conduit allows tankers to load and sail directly to global markets, bypassing the Strait of Hormuz, which has been disrupted by ongoing Iran conflict. However, this workaround now faces its own threat as Yemen's Iran-backed Houthis have targeted Saudi-linked shipping and infrastructure in the Red Sea.

The Houthi attacks on Saudi oil tankers and facilities near Jizan and Yanbu underscore the risk. Javier Blas, a Bloomberg Opinion columnist, noted that the Saudis may need 'a bypass for the bypass,' as engineering a new detour around Bab el-Mandeb would require the use of one or two extra pipelines, oil tankers, and Middle Eastern diplomacy to keep everything running.

The Suez Canal/Sumed option remains available for northbound voyages to Europe. However, if Bab el-Mandeb is effectively closed or too risky, volumes cannot simply reverse course without massive detours. Oil could move north through the Suez into the Mediterranean and then around Africa via the Cape of Good Hope to reach Asia, an extremely long and costly path.

The default alternative when Red Sea transit is disrupted is the Cape of Good Hope reroute, which adds 14-16 days for Northwest Europe-bound voyages and 10-14 days for Asia-Europe routes. The added costs per tanker include extra fuel worth $30,000-$35,000 per day, handling fees, war-risk insurance premiums, and crew costs.