Saudi Pipeline Closure Sends Oil and Gas Prices Soaring
The global oil market has been disrupted after Saudi Arabia shut down its east-west pipeline in response to drone attacks. The development caused Brent crude oil prices to surge by around 3% to $108 (£80) per barrel on Monday morning.
UK natural gas prices also rose by approximately 5% to 209p per therm, reaching the highest level since December 2022. This increase is particularly concerning as it coincides with a period of high demand for household energy over the winter months.
The pipeline's closure has further exacerbated supply constraints in the oil market. According to Richard Hunter, head of markets at Interactive Investor, 'This east-west pipeline had been moving several million barrels each day and inevitably causes additional supply constraints.'