Saudi Oil Pipeline Damage Triggers Global Energy Price Surge
A key oil pipeline in Saudi Arabia has been severely damaged by a drone strike, prompting fears of a global energy shortage.
The East-West Pipeline, which transports oil to the Red Sea, will be shut down for weeks according to anonymous officials, who estimate that repairing the damage could take three to five weeks. This includes fixing a major pumping facility.
Saudi Arabia had been using the pipeline to divert oil supplies away from the Strait of Hormuz, which has been closed to commercial shipping traffic since February due to tensions with Iran.
Oil prices surged past $109 per barrel on Monday as news broke that the pipeline would be out of commission for an extended period. The closure is expected to lead to a loss of up to 4% of global supply if not repaired within days, according to The Guardian.