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Economy

Saudi Arabia starts East-West pipeline exports as flows reach 3.5 million bpd

Bloomberg reported on September 28 that Saudi Arabia started exporting crude through its repaired East-West pipeline. Sources said flows reached approximately 3.5 million barrels per day against a total capacity of roughly 7 million barrels per day.

Why it mattersThe pipeline provides an alternative export bypass to the Strait of Hormuz, moving crude from eastern fields to the Red Sea.

Saudi East-West oil pipeline restart by Oct 15Toss-up55%▲ from 42% yesterday

How we got here

  1. Saudi Arabia shut a pipeline after drone attacks targeted Riyadh and Medina, blaming the strikes on Iraqi militia. Bairdmaritime, CNBC
  2. U.S. Energy Secretary Chris Wright said the interruption would be brief and measured in days. CNBC
  3. Pipeline operations restarted at a low rate, and Saudi Arabia built pressure on the line to resume flows. Investing, Bloomberg
  4. Pipeline volumes built while crude tanker loadings did not resume, leaving two scheduled ships unloaded. Bairdmaritime
  5. Saudi Arabia started exporting oil through the repaired pipeline at about 3.5 million barrels per day. Bloomberg

What's likely next

  1. The pipeline will resume crude supply to Aramco refineries located on the Red Sea coast, one of the sources said, adding that one cargo was scheduled to load at Yanbu later on Tuesday.
  2. Saudi East-West oil pipeline restartVery unlikely19%
  3. Saudi East-West oil pipeline restartToss-up55%▲ from 42% yesterday
  4. Saudi East-West oil pipeline restartVery likely80%

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