Saudi pipeline out for weeks as Brent tops $109 — SkimNews
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- Saudi Arabia's East-West Pipeline will be shut down for weeks after a drone strike last Thursday, with repairs at a major pumping facility expected to take 3 to 5 weeks, according to anonymous regional officials cited by the AP
- The Guardian reported Saudi Arabia could run out of oil export stocks within days if the pipeline isn't repaired, potentially removing up to 4% of global supply
- Satellite photos published Sunday showed extensive fire damage at a pumping station on the pipeline, which Saudi Arabia had been using to divert oil to the Red Sea away from the Strait of Hormuz
- Houthi fighters seized the Yemeni port city of Mocha from Saudi-backed forces on Thursday, giving the group greater ability to attack oil tankers in the Bab el-Mandeb Strait
- Brent crude surged past $109 per barrel in Monday trading after news of the multi-week repair timeline broke, according to Bloomberg
- US consumers are now paying an average $4.32 per gallon for gasoline and a record $6.23 per gallon for diesel, per AAA data released Monday
Why it matters: With the pipeline out 3 to 5 weeks, the Strait of Hormuz still mostly closed, and Houthis now controlling Mocha to escalate Red Sea attacks, three chokepoints are simultaneously strained — and Bloomberg's Alex Longley says the oil market 'is currently screaming for barrels.' US drivers are already absorbing record diesel at $6.23/gallon with no quick fix in sight.
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