Saudi Pipeline Attack Sparks Oil Price Drop Amid Supply Concerns

Oil prices fell on Wednesday after an unexpected build in U.S. crude inventories, despite concerns over supply risks following Saudi Arabia's suspension of oil loadings at its Yanbu port.

The suspension was due to an attack on the country's East-West pipeline by Yemen's Iran-aligned Houthis on Friday, which has shut a 4 million barrel per day route to the Red Sea port. Brent crude futures fell 93 cents, or 0.86%, to $107.82 a barrel at 0028 GMT, while U.S. West Texas Intermediate futures were down 97 cents, or 0.92%, at $104.86 a barrel.

U.S. crude oil inventories rose by 7.1 million barrels in the week ended September 11, according to data from the American Petroleum Institute. This was higher than analysts' expectations for a draw of about 1.6 million barrels. Crude inventories rose alongside gasoline and diesel inventories, which weighed on prices.

However, regional stock increases do not change the underlying tightness in the global crude market, according to Haitong Futures. U.S. energy secretary said that crude should resume flowing through Saudi Arabia's vital East-West pipeline within days.