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A key Saudi Arabian oil pipeline has been damaged in a Houthi attack, raising concerns that global oil supplies could fall by nearly 4% if the route is not restored quickly, international energy traders said, Reuters reported.
Saudi Arabia’s critical East-West oil pipeline has remained shut since Friday following a drone attack. Riyadh has not disclosed the extent of the damage or how long repairs will take.
Sources familiar with the matter said full repairs could take five to six weeks, although emergency work is underway to partially restore flows.
Saudi Arabia has become increasingly dependent on the pipeline after oil exports through the Strait of Hormuz were disrupted. The pipeline allows the kingdom to ship around 4 million barrels of oil a day to the Red Sea port of Yanbu.
Yanbu currently has only around five to seven days of oil stocks, while supplies from two Egyptian ports could continue for several more days. If the pipeline remains out of service, those reserves could quickly run down.
The International Energy Agency said Saudi oil supplies fell to their lowest level in three decades in August.
The disruption has already pushed up global oil prices and raised concerns about higher inflation and interest rates in the United States and other countries.
Before the war, around 22 million barrels of oil a day were supplied from the Middle East. That flow through the Strait of Hormuz has now fallen to between 6 million and 9 million barrels a day, while Saudi Arabia’s daily oil production has also dropped sharply.