Saudi Arabia: risk of running out of oil supplies due to pipeline attack

Saudi Arabia will run out of its oil supplies for export if it does not reactivate its main pipeline to the Red Sea (hit in recent days by drones from Iraq) within days, resulting in a loss of up to 4% of global supply, according to Saudi oil buyers and industry players. Reuters writes this on its website.

A further reduction in Saudi flows will worsen global supply shortages, which have already pushed fuel prices to record highs, fueled inflation around the world and pushed US government bond yields to their highest levels since the 2008 financial crisis. Since drone attacks forced Saudi Arabia to shut down its huge oil pipeline that crosses the country from east to west on Friday, Riyadh has provided no detailed information on the extent of the damage or for how long. will remain out of service.

The sources who spoke to Reuters gave different estimates: one said the damage could take five to six weeks to repair, while another said the pipeline could be restored sooner and could partially resume pumping even while repair work is still underway. Over the past six months, the pipeline crossing the desert of the Arabian Peninsula has spared Saudi Arabia much of the consequences of the war-related closure of the Strait of Hormuz, which has paralyzed exports from neighboring countries. The world's largest exporter used the pipeline to divert about 4 million barrels a day, or about 4% of global supply, to the Red Sea port of Yanbu.