Crude oil rises more than 3% after shutdown of key Saudi pipeline
Crude oil prices rose by more than 3% on September 14 after Saudi Arabia’s strategic East-West pipeline was shut down amid escalating tensions in the Middle East. Brent crude futures gained 3.1% to $107.82 a barrel, while WTI crude rose 3.2% to $103.22 a barrel.
The East-West pipeline was temporarily halted following a drone attack, Saudi officials said. The extent of the damage and the possible timeframe for restoring operations remain unclear.
The pipeline is strategically important because it allows Saudi Arabia to move crude oil to the Red Sea while bypassing the Strait of Hormuz. Its shutdown puts flows equivalent to as much as 4% of global crude oil supply at risk.
According to Reuters industry sources, crude oil inventories at the Saudi port of Yanbu may be sufficient for only five to seven days of exports under current conditions. This has increased market concerns over a possible supply reduction if the pipeline remains offline for an extended period.
Crude oil prices were also supported by new attacks in the region and uncertainty over shipping through the Persian Gulf and the Strait of Hormuz. A planned meeting between Gulf states and Iran to discuss the situation around the Strait of Hormuz was postponed.
Read also
Canada seeks a ‘unique alliance’ with the EU amid trade tensions with the US
Poland supplied nearly a quarter of South Africa’s wheat imports
Record oilseed crop increases pressure on global prices
Russia looks to the Far East and China as new grain export routes
Corn and soybean meal prices up 10–15%, pressuring Malaysia’s poultry sector
Got additional questions?
We will be happy to assist!
Write to us
Our manager will contact you soon