Saudi Arabia resumes oil exports via East-West Pipeline after repairs

Saudi Arabia has recommenced oil exports via the East-West Pipeline following repairs completed in the wake of drone strikes on September 10, according to Bloomberg. The Saudi Arabian oil company, Aramco, conducted tests last week to ensure the pipeline's readiness for resuming operations, Bloomberg reported Monday. Shipments bound for export have now resumed, restoring a crucial alternate export route for Saudi crude.

Saudi Arabia had relied on this pipeline during the conflict with Iran, in addition to increasing oil exports through the Strait of Hormuz this month. The pipeline's return could offer some respite to buyers looking to secure supplies amidst persistent threats to maritime shipping in the Arabian Gulf. Market participants are monitoring the volume of oil Saudi Arabia continues to ship through the Strait of Hormuz as the East-West Pipeline operates at full capacity.

While the Arabian Gulf remains susceptible to risks, with vessels occasionally facing attacks amid the ongoing war with Iran, the East-West Pipeline boasts a capacity of 7 million barrels per day. Typically, around 2 million barrels per day are directed towards refineries along Saudi Arabia's western coast, leaving the remaining capacity available for exports.

This westward shipping route proved vital during the Iran conflict, helping to curb sharp spikes in global oil prices. Oil prices surged above $107 a barrel on Monday as the United States and Iran remained at odds over reaching an agreement that could potentially end the Middle East conflict.