Saudi Arabia restarts East-West Pipeline, targets 4 million barrels per day

  • Saudi Arabia restarted its East-West Pipeline after drone strikes halted operations.
  • The pipeline can carry 7 million barrels per day and was seeking to restore 4 million.
  • Yanbu crude loadings had been halted since September 11, while one China-bound cargo was scheduled Tuesday.

Saudi Arabia restarted its East-West Pipeline on Tuesday and could resume crude exports from Yanbu later that day, Reuters reported, citing three sources briefed on the matter. The pipeline was operating below normal throughput, with flows expected to reach 40% of capacity within a couple of days and return to normal within six to eight weeks. Saudi Aramco was seeking to restore flows to about 4 million barrels per day, compared with the line's 7 million-barrel-per-day capacity. The restart helped push Brent crude down more than $2 toward $97 a barrel, its lowest level since September 8. Three of the pipeline's 11 pumping stations were damaged in drone strikes, according to satellite imagery and oil industry sources reviewed by Reuters. The pipeline had been offline since September 11, forcing Saudi Arabia to use ship-to-ship transfers and alternative export routes after flows through the Strait of Hormuz were disrupted. A Yanbu cargo bound for China was scheduled to load later Tuesday, while traders positioned tankers near Port Said and Sidi Kerir for potential transfers. Oil prices also fell after Iran said it could restore Strait of Hormuz access within seven days and Saudi Arabia sent more tankers to load at Ras Tanura.

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