The Saudi East-West pipeline attack, launched by drones from Iraqi territory, has forced Riyadh to shut one of its most critical oil export routes and pushed crude prices to their highest level in months, with Brent futures climbing above $105 a barrel.
Saudi Arabia closed the 1,200km pipeline on Friday as a precaution, its foreign ministry said, after satellite images showed scorched ground and smoke near the site. The ministry confirmed some injuries and damage, which it said was still being assessed.
Pipeline carried up to 5% of global oil supply
The pipeline transports crude oil from Abqaiq on the kingdom’s eastern Gulf coast to the port of Yanbu on the Red Sea, according to CNBC. Its significance to global supply is considerable: the pipeline had been moving between 4% and 5% of global oil supply, Reuters reported, citing ship tracking companies and analysts. The route allows Saudi Arabia, the world’s largest crude oil exporter, to bypass the Strait of Hormuz entirely when shipping oil westward.
The Saudi East-West pipeline attack drove oil prices sharply higher. Front-month Brent crude futures rose 1% to $105.68 a barrel, while front-month West Texas Intermediate settled up 1.3% at $101.39 a barrel, the Wall Street Journal reported. Crude had already crossed $100 a barrel for the first time since July in the days before the closure, as pressure mounted on Gulf shipping routes.
Iraq fires commander and opens investigation
Iraq acknowledged that the drone attack had originated in the Maysan governorate, a province bordering Iran. The prime minister’s office said the operations commander in the region had been removed from his post following confirmation the strike was launched from there. An investigation has been opened.
Saudi Arabia said it would not retaliate at this stage, following a telephone call from the Iraqi prime minister. Riyadh said it would ‘support the efforts of the Iraqi government’ to ‘prevent attacks’ launched from Iraqi soil against neighbouring states. Its foreign ministry added: ‘The Kingdom of Saudi Arabia affirms that it reserves its right to take all necessary measures to safeguard its sovereignty and security, protect its facilities, and ensure the safety of its citizens and residents.’
The Gulf Co-operation Council, made up of representatives from the United Arab Emirates, Bahrain, Oman, Qatar and Kuwait, condemned the strike. Secretary general Jasem Mohamed Albudaiwi said: ‘This attack represents a dangerous escalation and an unacceptable threat to the security of the Kingdom of Saudi Arabia, its territorial integrity, and its vital installations, as well as a flagrant violation of the principles of international law.’
Saudi East-West pipeline attack widens pressure on Gulf routes
The closure comes as the broader conflict in the Middle East bears down on energy infrastructure from multiple directions. The US-Iran war, now in its seventh month, has already disrupted the Strait of Hormuz, which facilitates one-fifth of global crude supply. A large-scale US-Israeli attack in the winter prompted Iran’s near-closure of the strait, according to ABC News. The East-West pipeline had been the principal means of routing Saudi exports away from that chokepoint.
Pressure has also intensified at the southern end of the Arabian Peninsula. Iranian-backed Houthi militants have this week seized control of much of Yemen’s coastline in a rapid advance, sources say. The group claims it now controls the Bab al-Mandab Strait, the gateway to the Red Sea and the Suez Canal, though it has said maritime navigation remains ‘safe for all companies except for Saudi vessels.’
Together, the developments have squeezed both sides of the Arabian Peninsula simultaneously, compressing the main export corridors available to Gulf oil producers.
Saudi Arabia’s foreign ministry said on Friday that the damage from the Saudi East-West pipeline attack was still being assessed. No timeline for reopening the pipeline has been given.
