Saudi Arabia shuts down east-west crude oil pipeline, Iraq fires military commander in response to drone attack
Quick Look
- Saudi Arabia shut down key east-west crude oil pipelines that supply 4%-5% of the world's supply as a precaution after multiple drone attacks.
- Iraq said the attack originated from its territory and fired the military commander in charge of Maysan province and closed its border crossing with Iran.
- The Iranian-backed Houthi armed forces in Yemen have strengthened their control over the Red Sea, which, combined with the disruption of transportation in the Strait of Hormuz, has led to tight energy supplies in the Arabian Peninsula and global oil prices have once again exceeded US$100 per barrel.
AI-generated summary
Why It Matters
The 1,200-kilometre oil pipeline that runs east to west across the Arabian Peninsula carries 400-55 million barrels of crude per day, accounting for 4%-5% of global supply, and is a key infrastructure for avoiding traffic jams in Homsheba. Iran supports Houthi armed forces in Yemen and has influence in the southeastern Iraqi province of Mizan.
A satellite image taken on Thursday (10th) showed black smoke rising from the area near the East-West Alley crude oil pipeline in Saudi Arabia. (Reuters)
[Financial Channel/Comprehensive Report] Saudi Arabia said on Friday (11th) that it had shut down the country’s key east-west crude oil pipeline as a precaution after multiple drone attacks. Both Iraq and Saudi Arabia said the drone attack originated in Iraq, where Iranian-backed militia groups operate. Iraq fired a military commander on Saturday (12th) in response to the attack.
"Reuters" reported that this 1,200-kilometer-long east-west pipeline across the Arabian Peninsula has helped Saudi Arabia avoid shipping congestion in the Strait of Hormuz in the past. The Saudi Energy Ministry said the pipeline closure was a precautionary measure. The pipeline has carried 4 million to 5 million barrels of crude oil per day in recent months, equivalent to 4% to 5% of global supply, according to ship tracking companies and analysts.
Please read on...
The attack comes as Iran-aligned Yemeni rebel Houthi rebels tighten control of the Red Sea; this, combined with shipping disruptions in the Strait of Hormuz, has strained energy supplies on both sides of the Arabian Peninsula and pushed global oil prices back above $100 a barrel.
The Saudi Energy Ministry stated that the east-west pipeline was attacked in the Riyadh and Medina areas of Saudi Arabia on the morning of Thursday (10th).
It is unclear who is responsible for these attacks. Satellite images showed black smoke rising from a pipeline area south of Medina. The Saudi foreign ministry said the attack caused some injuries and damage and that the damage was being assessed, but did not elaborate on the impact on exports.
The dismissed Iraqi military commander was responsible for military operations in Maysan province, according to a statement released by the Iraqi Prime Minister's Office on Saturday. Maysan province, located in southeastern Iraq and bordering Iran, has long been seen as an area where Iran-backed Shia militia groups operate and maintain influence.
The Saudi Ministry of Foreign Affairs said in a statement that after the Iraqi Prime Minister made the request, Saudi Arabia has currently chosen not to retaliate; but at the same time, it stated that it reserves the right to "take all necessary measures" to protect its own interests.
The Iraqi government condemned the attacks, and two security sources told Reuters that Iraq had ordered the closure of the Shalamcheh border crossing between Iraq and Iran as a precautionary measure. The port is one of the main routes for Iran to import vegetables and other food supplies to Iraq.
Two sources also said that authorities are currently launching a large-scale operation to find those responsible for the pipeline attack.
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What to Watch
AI outlook — possibilities, not facts
Saudi Arabia will decide whether to restart the pipeline or look for alternative transport routes after assessing the damage
Likely · Within weeks
Iraq will continue to strengthen security at its border with Iran to prevent Iranian-backed armed groups from using their territory to launch attacks
Very likely · Within days
If the disruption of transportation in the Red Sea and the Strait of Hormuz continues, global oil prices will be under further pressure.
Possible · Within months
Open Questions
- Which group specifically launched the drone attack?
- What is the extent of the damage to the pipeline and the timing of its repair?
- Is Iraq going to step up control of the Iranian border?
- Under what conditions will Saudi Arabia change its decision to not retaliate?
