Saudi East West Pipeline Resumes with 5.8 Million Barrels Daily

Saudi Arabia's East West pipeline has resumed operations, transporting 5.8 million barrels of oil per day as of Tuesday morning, according to Energy Minister Prince Abdulaziz bin Salman. The pipeline, which was shut down on September 10 following drone attacks from Iraq, was restored within five to six days after the incident, which the minister described as a "big hit."

The East West pipeline is a critical route for Saudi oil exports, acting as a pressure release valve that reduces reliance on the vulnerable Strait of Hormuz. Recent attacks by Yemen's Houthi militants on tankers and infrastructure along the west coast have heightened the importance of this alternative route. The pipeline's outage forced exports to be rerouted through Hormuz, increasing exposure to potential disruptions.

By the end of last week, state-run Saudi Aramco had increased the pipeline's throughput to nearly 6 million barrels per day, representing over 80% of its capacity. Approximately 4.5 million barrels per day were available for export from Yanbu on the Red Sea. This resumption of flows helped mitigate potential price spikes and maintained a steady supply of oil to the market.

The rerouting of oil exports affects shipping risks, timing, and global oil prices. The mix of exports from Yanbu and Hormuz can influence supply jitters and, consequently, the cost of fuel and everyday goods. Investors need to monitor these flows as changes in either route can lead to rapid price fluctuations.