Saudi Pipeline Damage Threatens Global Oil Supply
A drone attack on Saudi Arabia's east-west pipeline has left the country facing a potential oil shortage, according to industry sources. The pipeline, which is over 1,200 kilometers long, was damaged in the attack and may take up to six weeks to repair.
The damage means that Saudi Arabia will struggle to maintain exports from its ports on the Red Sea, including Yanbu, which has only enough stocks to last for five to seven days. This could lead to a loss of up to 4% of global oil supply, exacerbating an already tight market.
The attack, blamed by Saudi authorities on militants in Iraq, is part of a wider conflict in the Middle East that has seen Yemen's Houthi forces target Saudi oil infrastructure and shipping. The disruption to crude supplies has driven up prices across refined derivatives such as petrol and diesel, with diesel prices in the US hitting a record high.
Iranian officials had suggested attending a regional meeting scheduled for Monday to present an agreement on governing shipping routes through the strait of Hormuz, but this has now been postponed. The spiralling conflict is raising concerns about global supply and potential price spikes.