Saudi Arabia Sells Spot Oil Cargoes After Pipeline Outage
Saudi Arabia's key onshore pipeline has been shut down due to drone attacks from Iraq near the Iranian border, forcing the Kingdom to sell up to 20 million barrels of crude oil in the spot market.
The spot sales have mainly gone to Chinese refiners and other East Asian countries' crude processors, who will load the cargoes onto vessels outside the Strait of Hormuz via ship-to-ship transfers in the Gulf of Oman.
This move is a result of the East-West pipeline's outage, which has disrupted Saudi Arabia's oil route to bypass the Strait of Hormuz. The 750-mile-long pipeline was established as an alternative after the Middle East conflict started and Hormuz was closed to shipping traffic.
The shutdown has also affected some September deliveries to European refiners, with Aramco canceling or delaying them.