Recent disruptions in Saudi Arabia's East-West pipeline, which is one of the most important routes for transporting oil from the country to the port of Yanbu on the Red Sea, have raised serious concerns in the global oil market due to drone attacks. This pipeline typically has a capacity of 4 million barrels of oil per day, equivalent to 4 percent of global oil supply.
Consequences of Disruption in Saudi Oil Exports
Reports indicate that disruptions in the operations of this pipeline could lead to a decrease in oil inventories at the port of Yanbu. Estimates suggest that current inventories in Yanbu are only sufficient for five to seven days if pipeline operations do not resume. This situation could put additional pressure on Saudi Arabia, which is already experiencing a significant reduction in oil production. Saudi oil production fell to 6.2 million barrels per day in August, compared to 10.9 million barrels per day in February, indicating a substantial decline.
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New Threats to Energy Corridors
Additionally, Houthi forces, backed by Iran, are advancing along the shores of the Red Sea in Yemen and have reached the island of Perim. These advances could pose a threat to another vital energy corridor in the world, as Saudi Arabia has increasingly relied on Red Sea exports. This situation significantly increases security risks in energy corridors. Under normal circumstances, the East-West pipeline serves as an alternative route to bypass the Strait of Hormuz, but now the situation has changed such that this pipeline itself has become a target for attacks.
Overall, the disruption in Saudi Arabia's East-West pipeline presents a major challenge in the global oil market and highlights the severe dependence on energy infrastructure in this region. If repairs to the pipeline are time-consuming, Saudi Arabia may face further difficulties in maintaining its oil exports.
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