Saudi Pipeline Shutdown Threatens Global Oil Supply
Saudi Arabia's East-West pipeline has been shut down after drone attacks last Thursday in the Riyadh and Medina regions. The Saudi energy ministry announced the shutdown as a precaution, with emergency and technical teams securing the pipeline and checking its safety.
The pipeline carries oil from eastern Saudi Arabia to Yanbu on the west coast, allowing exports to leave through the Red Sea without passing through the Strait of Hormuz. Aramco increased pumping through the pipeline to its maximum capacity of 7 million barrels a day in May, helping maintain exports while shipping through Hormuz was disrupted.
Oil buyers and traders estimate that a prolonged shutdown could put at risk around 4 million barrels a day, or about 4% of global oil supply. Saudi authorities have not confirmed this estimate, but it is based on stored oil supplies at the Red Sea port of Yanbu, which could keep exports going for five to seven days.