The Saudi East-West oil pipeline: the strategic bypass in the crosshairs of global tensions

With its 50 years old and somewhat forgotten until a few months ago, the Saudi East-West oil pipeline that stretches across the country's desert to reach the Red Sea has been, in these weeks of the Hormuz blockade, a very precious and fragile thread on which the global economy and the oil market have hung thanks to a capacity of 7 million barrels per day.

And yet now the bypass may need another bypass. With the continuation of hostilities and attacks on oil tankers, the Saudi authorities have taken steps to restore the full capacity of the infrastructure and those of the Red Sea terminals, Yanbu North and Yanbu South, which bypass the Strait of Hormuz.

The oil passed through the pipeline in recent months, according to Bloomberg calculations, has gone to the most crude-dependent nations in the region: Japan, India, China and South Korea. Some Chinese and Indian ships thus managed to load the crude and reach the Indian Ocean without attacks, while those of other nationalities had to head north towards Suez.

But the fragility of the solution has emerged in recent hours. Both for the attacks carried out via drones on the oil pipeline, and for the blockade of the Bab el Mandeb Strait, to the south, by the Houthis. In fact, the infrastructure has an objective obstacle to being able to allow Saudi Arabia to return to pre-war levels (in August it reached the minimum levels of 3 million) or in any case free itself from the Iranian and Houthi threat: large oil tankers (VLCCs), which transport two million barrels, cannot transit fully loaded through the Suez Canal.

There are two possible solutions proposed by the experts consulted by Bloomberg in recent weeks: setting up a fleet of smaller oil tankers that shuttle between its ports and the Egyptian Sumed oil pipeline which connects the Red Sea to the Mediterranean Sea and, in addition, the Israeli Eliat pipeline.

This solution would pose further elements of political criticality. Sumed, however, has a capacity of only 2.5 million barrels, which would force the Saudis to transit half-load supertankers through Suez to increase capacity. Even so, supertankers waiting for oil in the Mediterranean to reach Asia via the Cape of Good Hope would take 25 days longer, with related additional costs.