US Energy Secretary Chris Wright announced on Monday that a key Saudi oil pipeline, which was attacked last week, should be back online "soon." Speaking on Bloomberg Television, Wright indicated that Saudi officials have been diligently assessing the damage and that more clarity on the pipeline's operational status is expected imminently. This comes after the pipeline's closure disrupted oil shipments and left Asian refiners awaiting updates on cargo deliveries from Saudi Arabia's Red Sea port of Yanbu.
The East-West pipeline, also known as the Petroline, is crucial as it transports crude oil from Saudi Arabia's eastern oil fields to the Red Sea port of Yanbu, bypassing the Strait of Hormuz. The 1,200km (746-mile) pipeline typically carries about 4 to 5 million barrels of oil per day (bpd), representing approximately 4 to 5 percent of global supply. Its closure follows drone attacks last Thursday, which the Saudi Ministry of Energy described as a "precautionary" measure due to damage and injuries in the Riyadh and Medina regions. The attack exacerbated global oil market concerns already heightened by disruptions in the Strait of Hormuz and increased Houthi attacks in the Red Sea.
The timing of the pipeline's full return to service remains uncertain, with estimates varying from a quicker restart to five to six weeks for repairs, according to sources familiar with the situation. The closure has left Asian refiners in limbo, with several reporting no official communication regarding the status of operations or the extent of the damage to the pipeline. While Yanbu port holds about five to seven days of available stocks and additional supplies could come from Egyptian facilities, the ongoing disruptions contribute to already falling global oil inventories, which the International Energy Agency reported hit a more than three-decade low in August. These market pressures have kept Brent crude trading between $70-$90 in recent months, with some experts warning prices could surge to $150 a barrel if disruptions persist and reserves dwindle.
