Petroline Shutdown Disrupts Saudi Oil Supplies

Saudi Arabia's East-West Petroleum Pipeline, also known as Petroline, has been shut down after drone attacks from Iraq on Thursday. The pipeline, which stretches about 1,200 kilometers from Abqaiq to Yanbu on the Red Sea, carries crude oil from production and processing centers to western-coast refineries and export facilities.

The shutdown is a precautionary measure, with emergency response and technical teams working to secure the affected areas and assess the damage. The ministry has not disclosed the extent of the damage or how long the route could remain out of service.

Petroline was used as an alternative to the Strait of Hormuz after it was effectively closed earlier this year. Saudi Arabia rapidly ramped up crude flows through Petroline, using Yanbu to keep exports moving through the Red Sea. Despite some disruptions, shipments from the port rose from 2 million barrels per day before the war to over 5 million barrels per day in early June.

The shutdown could further disrupt exports from a region that normally accounts for a fifth of global supply and remove a key avenue for getting Saudi crude to global buyers. The actual impact depends on how much crude was flowing through the pipeline, how much was destined for refineries, and how much could have been loaded onto tankers at Yanbu.