Saudi Arabia Reroutes Exports Amid US Fuel Inventory Surge
Oil prices have fallen on Wednesday after US fuel inventories surprisingly rose and Saudi Arabia offered to reroute exports through Oman. Brent crude, the international benchmark, dropped 1.29% to $107.25 per barrel, while West Texas Intermediate, the US benchmark, fell more than 2% to $103.65 per barrel.
The increase in US inventories was reported by Reuters, citing figures from the American Petroleum Institute. The API data showed that US crude oil, gasoline, and distillate inventories rose last week. This unexpected development has led to a decline in oil prices.
Saudi Arabia's decision to reroute exports through Oman is seen as an effort to ease concerns about oil flows through the Middle East. However, the country's ability to reopen its key East-West pipeline will be crucial for the global energy industry, which relies on it for around 4% of its oil supply.
U.S. Energy Secretary Chris Wright said that the repair of the pipeline would take days, not weeks, to complete. This assessment contradicts an earlier estimate by a source familiar with the matter, who predicted that Riyadh could take up to six weeks to fix the pipeline if it doesn't get hit again.