Crude oil prices continued to rise on Tuesday as the shutdown of Saudi Arabia’s East-West oil pipeline and escalating Red Sea security risks heightened concerns over further disruptions to Middle East supply.
As at the time of writing, 08:47 am (WAT), Brent crude was trading at $107.60 per barrel, up 1.80%, while WTI stood at $103.30 per barrel, gaining 1.85%.
The latest gains followed attacks on Saudi energy infrastructure and fresh strikes by Iran-backed Houthi forces, adding to concerns over the security of crude flows through the region. The Houthis have expanded their control along Yemen’s western coast, increasing risks around the Red Sea and the Bab el-Mandeb shipping corridor.
Saudi Arabia’s East-West Pipeline, which provides an alternative route for moving crude away from the Strait of Hormuz to the Red Sea port of Yanbu, remains shut following last week’s attack. The pipeline can redirect about 4 million barrels per day, equivalent to roughly 4% of global oil supply.
The duration of the outage has become a major concern for the market, with repairs potentially taking weeks. Prolonged disruption could constrain Saudi export flows as available crude stocks at Yanbu are drawn down before the pipeline returns to full operation.
The supply concerns have been compounded by continued uncertainty around the Strait of Hormuz, through which a significant share of global oil supply normally moves. A planned meeting between Iran and Gulf states in Oman was postponed, weakening expectations of an immediate diplomatic arrangement to ease shipping risks.
The combination of the Saudi pipeline outage, Houthi attacks and continued uncertainty around the Strait of Hormuz is keeping crude supply risks elevated, with traders closely monitoring the duration of the disruptions and their impact on physical oil flows.