Japan Rushes to Buy Oman Crude as Saudi Pipeline Shutdown Disrupts Exports

Saudi Arabia's East-West pipeline has been shut down temporarily due to drone attacks from Iraq. The 750-mile-long pipeline is a vital route for Saudi crude exports, bypassing the Strait of Hormuz. Japan's refiners have rushed to buy Oman's crude as a result, with some expecting to pick up their cargoes at the port of Yanbu as scheduled.

The East-West pipeline was created after the Middle East conflict started and the Strait of Hormuz was closed to shipping traffic. Saudi Arabia had re-routed most of its crude loadings from western ports in the Persian Gulf to the Red Sea port of Yanbu using this pipeline. The repairs could take three to five weeks, according to regional officials.

U.S. Energy Secretary Chris Wright has insisted that the pipeline will be back into service within days, but Asian refiners are uncertain about the impact on oil loadings at Yanbu. At least four Asian refiners have not received any clarification from Saudi Arabia yet, and two of them expect to proceed with their cargoes as planned unless they receive word of delays.