Following drone attacks that halted Saudi Arabia's East-West pipeline, the kingdom is altering its oil export routes. The pipeline, which transports crude to the Red Sea coast, has been shut down, leading Saudi Aramco to pivot its sales strategy to destinations outside the Strait of Hormuz.
Saudi Aramco has reportedly sold approximately 20 million barrels of crude to Asian refiners for pickup this month and next from locations just outside the Strait of Hormuz. These sales included Chinese state-owned and independent processors, as well as other importers in East Asia, according to traders familiar with the matter.
The shutdown of the East-West pipeline, which typically allows Saudi crude to bypass the Strait of Hormuz, has necessitated this change. Reports indicate that three pumping stations along the 1,200 km pipeline were hit in the attacks. While Saudi Arabia is seeking to restore about half of the pipeline's capacity within days, the full repair timeline remains unclear. This pivot to increased sales via the Strait highlights a temporary reliance on this waterway, which some analysts had previously considered a less crucial option for Saudi exports due to the pipeline's existence. The ability to quickly repair damaged infrastructure is a key factor for the kingdom in managing such disruptions.
