Houthi Strikes Hit Saudi Oil Exports Hard

Houthi strikes on Saudi Arabia's oil infrastructure have disrupted its ability to export crude oil, threatening to reduce supply further. The East-West pipeline, which transports 3-4 million barrels per day (b/d) of Saudi crude, has been damaged by the attacks.

The damage to the pipeline and other oil facilities in Saudi Arabia comes at a time when Brent crude prices are already at $105 per barrel, with Middle Eastern grades such as Murban and Oman trading at $120 per barrel. The OPEC cartel lowered its 2026 global oil demand growth forecast to 380,000 b/d, down by 200,000 b/d from the previous month.

The disruptions in Saudi Arabia's oil supply have also led some Asian refiners to ask Saudi Aramco to price their term crude against ICE Brent, rather than Dubai or Oman. This is because the Hormuz disruptions have shrunk deliverable supply and driven prices of these benchmarks up by about $18 above Brent.