21 hrs ago
Saudi Pipeline Attack Pushes Oil Prices Higher Amid Regional Tensions
Oil prices went up because traders worried that less oil might reach world markets.
Saudi Arabia closed an important pipeline after it was damaged by drone attacks.
One report said the drones were launched from Iraq.
The pipeline carries oil toward the Red Sea and helps Saudi Arabia avoid the Strait of Hormuz.
It can carry about 4 million barrels of oil each day.
Another report said repairs could keep it mostly closed for weeks.
Attacks and tensions involving Iran and Houthi forces have also affected important shipping routes.
Saudi Arabia’s reported oil production fell to 6.238 million barrels per day.
Traders fear that more problems could make oil even more expensive.
Brent crude was reported at $106.93 in one report and $109.39 in another Tuesday update.
West Texas Intermediate rose $1.29, or 1.24%, to $102.65 per barrel.
Drones launched from Iraq damaged Saudi Arabia’s East-West Pipeline, forcing its closure for repairs.
The pipeline can carry about 4 million barrels daily and recently transported 2.6 million to 4 million barrels per day.
Tensions involving Iran, Houthi attacks and disrupted shipping routes increased concerns about global oil supplies.
- Who
- Saudi Arabia, attackers identified in one report as drones launched from Iraq, Iran, Houthi forces, Gulf Arab states and oil traders are involved.
- What
- Damage to Saudi Arabia’s East-West Pipeline forced its closure and raised concerns about disruptions to international oil supplies.
- Where
- The disruption involves Saudi Arabia’s East-West Pipeline, the Red Sea, the Strait of Hormuz, the Bab el-Mandeb Strait and related routes in the Gulf region.
- When
- The price gains were reported Tuesday after the pipeline was damaged on Thursday of the previous week.
- Why
- The pipeline closure, regional attacks and shipping disruptions could reduce the amount of crude reaching global markets.
Key facts
- Brent crude prices
- One report cited $106.93 per barrel after a $1.24 increase; another cited $109.39 after a $3.70 increase.
- West Texas Intermediate
- $102.65 per barrel after rising $1.29, or 1.24%.
- Pipeline capacity
- About 4 million barrels per day, nearly 4% of global oil supply.
- Recent pipeline flows
- Rystad Energy estimated the pipeline carried 2.6 million to 4 million barrels per day since late August.
- Pipeline status
- Operations were halted after an attack; one report said the pipeline could remain largely out of service for weeks.
- Saudi production
- Saudi Arabia reported production falling by 1.9 million barrels per day to 6.238 million barrels per day.
- Diplomatic talks
- A planned meeting between Iran and Gulf Arab states in Oman was postponed after the attack.
Sources
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