Oil shock on the horizon – Saudi Arabia reduces supplies
After a drone attack on September 10, the East-West oil pipeline in Saudi Arabia was halted. Saudi Aramco canceled some deliveries to European refineries. Brent prices exceeded $108, with analysts predicting a rise to $120. Restoration will take 3–5 weeks, while reserves at the Yanbu port will last 5–7 days.
The key Saudi oil pipeline East-West was halted after a drone attack on September 10. Saudi Aramco has already canceled or postponed some deliveries to European refineries. The pipeline connects fields in the east of the country to the port of Yanbu on the Red Sea, with a capacity of about 7 million barrels per day. Saudi and Iraqi authorities stated that the drones may have come from Iraqi territory; there is no official confirmation of Houthi involvement yet. The pipeline's significance is especially high as it allows oil exports bypassing the Strait of Hormuz. Reserves in the Yanbu area will last 5–7 days, and infrastructure restoration will take 3–5 weeks. Brent prices rose by nearly $3, exceeding $108 per barrel. Analysts predict a rise above $120 if disruptions coincide with issues in Libya and on sea routes. Polish Orlen, a major recipient of Saudi oil, reports normal refinery operations and is increasing purchases from alternative suppliers. Riyadh has not yet announced a complete halt of supplies to Europe.