Crude flows through Saudi Arabia's East-West pipeline have recovered to around 5.5mn b/d, according to a source, allowing for a restart of exports from the Red Sea port of Yanbu.
The 7mn b/d capacity pipeline, on which Saudi Arabia had been relying to export crude since the US-Iran war disrupted seaborne movements through the strait of Hormuz, was shut on 10 September after a drone strike.
Riyadh has yet to issue a formal damage assessment. Sources said three of the line's 11 pumping stations had sustained damage, one significantly. The pipeline itself sustained no damage, they said.
Repairs to the most severely affected station would take weeks, they said. But state-controlled Saudi Aramco created a temporary bypass pipeline to route the crude around that station and the pipeline is today running at more than 75pc of capacity.
The pipeline carries crude from Saudi fields and oil processing facilities near the Mideast Gulf to Yanbu for export, and supplies refineries, power stations and desalination plants on the Red Sea coast. Prior to the US-Iran war, 1.5mn-2mn b/d of crude would typically go through the line to feed those plants. But runs at Saudi Red Sea refineries have been reduced in recent weeks, primarily because Aramco shut its 400,000 b/d Jizan refinery following an attack in early September.
At current flow rates, Argus estimates crude available for export at Yanbu is around 4mn-4.5mn b/d. Shipbrokers said exports appear to be resuming.
Data from Kpler show crude exports from Saudi Arabia's Mideast Gulf port of Ras Tanura jumped in September to 3.6mn b/d from less than 1mn b/d in August, in response to the East-West pipeline outage and ongoing threats by Yemen-based Houthi militants to shipping in the Red Sea.
Aramco has been inviting refiners in Asia-Pacific to bid for cargoes loading via ship-to-ship (STS) transfers in the Gulf of Oman, or for cargoes on a delivered basis, in September, October and November. It is unclear if the resumption of exports from Yanbu will necessarily shift supply back towards the Red Sea, especially given the continued risk for Saudi shipping through the Bab el-Mandeb.
