The attack on Saudi Arabia's "East-West" oil pipeline last Thursday has significantly harmed global oil markets. This 1,200-kilometer pipeline transports about 4 to 5 million barrels of oil daily, connecting the main oil production fields in the east of the country to the port of "Yanbu" on the Red Sea. This route allows Saudi Arabia to bypass the Strait of Hormuz, which has been nearly closed since the war began in February.
Details of the Attack and Pipeline Status
The Saudi Ministry of Energy has stated that this shutdown is a "precautionary" measure, as the attack caused damage and injuries in the Riyadh and Medina regions. Given the severe disruption of oil flow from the Strait of Hormuz, Saudi Arabia has increasingly relied on the East-West pipeline. The question now arises as to what the closure of this pipeline means for the global oil market.
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Reports indicate that the extent of the damage is still unclear, and estimates regarding the timeline for the pipeline's return to normal operations vary. Sources familiar with the situation have told news agencies that repairs may take five to six weeks, while other sources claim that operations may resume sooner.
Economic and Global Consequences
The closure of this pipeline occurs at a critical time for the global oil market. Before the war began, the Strait of Hormuz supplied more than one-fifth of the world's oil (about 20 million barrels per day). Current estimates suggest that oil flow through this strait is around 6 to 9 million barrels per day, indicating a significant reduction in the volume of this transfer.
In the first five months of the war, Saudi Arabia increased the amount of crude oil sent westward, raising the flow to about 4 to 5 million barrels per day. However, with the pipeline's closure, Yanbu has sufficient reserves to continue exports for about five to seven days. Meanwhile, other storage facilities can also provide supplementary resources for a few more days.
The International Energy Agency has also predicted that global oil supply will decrease by about 5.7 million barrels per day this year, equivalent to 6 percent of total global supply. If the pipeline closure continues, there is a possibility of Brent crude oil prices rising to higher levels.
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