Saudi Arabia’s key East-West oil pipeline is operating normally, according to people familiar with the matter, despite earlier reports of a shutdown following a fresh attack. Oil continues to flow through the East-West link after a strike on a pumping station over the weekend, which AFP reported citing an unidentified source in the kingdom’s energy sector. Saudi Aramco and the energy ministry did not immediately respond to requests for comment.
Oil prices that jumped as much as 1.2% after the AFP report eased following confirmation of normal operations. Aramco had ramped up supplies through the 7 million barrel-a-day pipeline to over 80% of capacity by late last week, bringing back much of the link after it was attacked by drones launched from Iraq last month.
The pipeline has served as a vital conduit for keeping oil flowing during the Iran war with shipments through the Red Sea without relying on risky journeys via the Strait of Hormuz. After accounting for supplies to refineries on Saudi Arabia’s west coast, Aramco had about 4.5 million barrels a day of flows available for exports as of last week.
However, the Red Sea route has come under pressure in recent months with Yemen’s Houthi militants attacking tankers and Saudi infrastructure along the kingdom’s west coast. The conflict in Yemen has escalated as the internationally recognized government launched a full-scale military campaign to recapture Houthi-held territory.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing