Saudi Aramco halts crude oil supply to European customers

Saudi Aramco has notified at least two European oil refining companies that they will stop receiving crude oil next month due to an attack on the kingdom's main pipeline to the Red Sea, according to Bloomberg News. This decision impacts all European buyers, as the shipments are typically provided through term contracts that guarantee a steady monthly supply.

Saudi Aramco has not yet responded to requests for comment. Saudi Arabia shut down its East-West pipeline last week following a drone attack, and it is anticipated to partially reopen within days and fully resume operations within six weeks, according to a person familiar with the situation. The 1,200-kilometer East-West Pipeline had been transporting 4 million to 5 million barrels of oil per day to the Red Sea port of Yanbu, accounting for 4% to 5% of global oil supply.

Following the September 11 drone attack, three pumping stations were damaged, with repair costs estimated at anywhere from a partial restart within days to a full recovery in five to six weeks. In June, European OECD nations had imported 577,000 barrels of oil per day from Saudi Arabia via Egypt's Mediterranean port of Sidi Kerir through a Red Sea pipeline link. This interruption means that these deliveries will cease entirely for the month of October.