Saudi restores pipeline, oil spikes

Saudi Arabia said on April 12 that it had restored the East-West oil pipeline to about 7 million barrels a day, reopening its main route to the Red Sea as crude climbed back above $100. (usnews.com) The line runs about 1,200 kilometers from Abqaiq in eastern Saudi Arabia to Yanbu on the Red Sea, letting Saudi crude avoid the Strait of Hormuz. Saudi officials said recent attacks had cut pipeline throughput by about 700,000 barrels a day before repairs were completed. (aljazeera.com) Oil prices jumped on April 13 after the United States moved to blockade ships leaving Iran’s ports following the collapse of weekend talks. Reuters reported Brent crude rose more than 7% to about $102 a barrel. (channelnewsasia.com) The U.S. military said the blockade would start at 10 a.m. Eastern Time on Monday, April 13, a step Reuters said could keep roughly 2 million barrels a day of Iranian oil off the market. President Donald Trump said the move followed failed negotiations, and Tehran threatened retaliation against Gulf neighbors’ ports. (usnews.com) The Strait of Hormuz is the narrow waterway between Iran and Oman that carries one of the world’s biggest oil flows. The U.S. Energy Information Administration said about 20 million barrels a day moved through it in 2024, equal to about one-fifth of global petroleum liquids consumption. (eia.gov) Saudi Arabia built the East-West pipeline in the 1980s during the Iran-Iraq War to keep exports moving when Gulf shipping was under attack. With Hormuz traffic disrupted again, that older bypass has become the kingdom’s only crude export route. (usnews.com) The restored line does not replace all the oil that normally crosses Hormuz. The International Energy Agency said the strait handled an average 20 million barrels a day of crude and oil products in 2025, far above the Saudi pipeline’s 7 million barrel daily capacity. (iea.org) Markets were already on edge before the repair. Reuters said Wall Street indexes were mixed on April 13 as traders weighed the Iran blockade and President Trump’s fresh threat of steep tariffs on China, with higher energy prices adding to inflation worries. (lse.co.uk) Saudi Aramco has said the East-West line can run at 7 million barrels a day, but officials also said about 300,000 barrels a day of capacity at the Khurais field remains offline after the attacks. That means the repair helps Saudi exports, but it does not fully erase the supply hit from the wider conflict. (energyintel.com) For now, Saudi Arabia has reopened its desert detour, and traders are treating it as a partial fix rather than an all-clear. Oil is still above $100 because the bigger bottleneck is not one pipeline station in Saudi Arabia, but the Gulf shipping lane the world still cannot replace. (bloomberg.com)