Saudi Pipeline Closure to Fuel Price Spikes: One to Two Months or More

Fuel price spikes are expected to continue as Saudi Arabia's critical pipeline remains closed after a drone strike. The damage assessment is ongoing, and it could take one to two months for the pipeline to restart.

Saudi Aramco has informed at least two European refiners that they won't receive any crude oil from them next month due to the pipeline closure. This will further reduce global oil supplies, exacerbating fuel price increases.

The national average gas price in the US hit $4.46 on Friday, with diesel breaking another record high of $6.44, according to AAA. California is experiencing the highest diesel prices in the nation at an average of $8.39, impacting not only Californians but also consumers nationwide due to increased delivery costs.

Andrew Lipow, a petroleum consultant, stated that if Saudi Arabia can bypass the pipeline pump stations, they may be able to restore operations at 50% capacity within days. However, if repairs are needed for the pump stations, it could take several weeks or even months for the pipeline to restart.