Saudi Arabia partially restarts key oil pipeline after drone attack, Brent falls below $100
Saudi Arabia has partially restarted its East-West oil pipeline after a drone attack shut it down earlier this month, helping push global oil prices lower as markets anticipate increased Saudi exports.
The pipeline is currently operating at a low rate, three sources briefed on the matter told Reuters. It is expected to reach about 40% of its capacity within several days, while a full restart could take six to eight weeks.
The East-West Pipeline has become particularly important since the U.S.-Israeli war with Iran disrupted oil shipments through the Strait of Hormuz. Saudi Arabia had been using the pipeline to reroute around 4 million barrels of crude per day to the Red Sea port of Yanbu — roughly 4% of global oil supply.
The pipeline was shut down on Sept. 11 after drone attacks damaged three of its 11 pumping stations. Saudi Arabia has blamed the attacks on an Iraqi militia.
News of the restart contributed to a drop in global oil prices on Tuesday. Brent crude fell by more than $2 to around $97 a barrel, its lowest level since Sept. 8.
Saudi Arabia was also preparing to resume crude exports from Yanbu, with the first cargo after the shutdown scheduled to be loaded for shipment to China.
The pipeline has a maximum capacity of 7 million barrels per day, while Saudi Aramco is seeking to restore pumping to about 4 million barrels per day.