Saudi Arabia's East-West Pipeline is pumping oil again after a drone attack knocked it out for over a week

Is the East-West Pipeline moving oil again? Saudi Arabia has restarted operations on its East-West pipeline yesterday, three sources familiar with the matter told Reuters — after a drone attack forced it offline earlier last week. The line is running at a reduced rate for now — three of its 11 pumping stations were damaged in the attack, with Aramco targeting nearly 4 mn bbl / d and 40% of capacity expected within days, though a full restart will take six to eight weeks.

The first signs of life: One cargo bound for China was scheduled to load at Yanbu yesterday evening, according to the sources.

Aramco was already lining up buyers ahead of the restart: The company had informally told Asian refiners they'd soon be able to collect crude again from Yanbu, Bloomberg reported even before the restart was confirmed. Aramco kept ramping up loadings from Ras Tanura in the Gulf throughout the outage, according to shipping data reported by Reuters.

Not every buyer got the workaround in time: Several Asian refiners contacted by Aramco missed scheduled loading dates after the pipeline shutdown and had tankers either idling near the Red Sea port or steaming toward it.

Markets already moved on the restart: Brent crude fell more than USD 2 per barrel toward USD 97 — its lowest since 8 September — as traders priced in more Middle Eastern oil flows coming back online.

Meanwhile, the Gulf route is carrying more than it did a month ago: Saudi crude moving through the strait averaged 2.9 mn bbl / d over the past six days, up from just 700k bbl / d in August. Aramco has also arranged some 60 mn barrels out of Ras Tanura for September-October delivery, crossing Hormuz before being transferred ship-to-ship near Sohar, largely to Asian buyers who'd otherwise be stuck waiting in Yanbu.

That’s crude volume, though — not traffic: Only two commodity vessels of any kind were recorded crossing the strait on Monday, down from 10 on Sunday, Reuters reports, citing Kpler data — against a pre-war norm of roughly 125 large commercial vessels a day. Saudi Arabia is pushing more of its own oil through Hormuz even as the strait itself stays close to empty.

The bigger picture

Asia has a fallback that Europe doesn't. Its refiners can pull replacement barrels from Ras Tanura, cross Hormuz, and complete the Sohar ship-to-ship transfers. Japan's refiners say they have secured enough crude through November partly because Saudi crude keeps reaching them via Hormuz at Aramco's own risk before being transferred to them outside the Gulf.

Europe has no equivalent, and it’s already paying for it. Its westbound route runs through Ain Sokhna via the Sumer pipeline and out at Sidi Kerir on the Mediterranean — and with the East-West Pipeline down, the chain has received no new crude since the attack. At least two European refiners were told they would receive no Saudi crude under their long-term contracts in October after the pipeline attack, while buyers including Poland’s Orlen have sought replacement grades from elsewhere. Yanbu — and the crude it feeds toward the Red Sea, Egypt, and the Mediterranean — matters much more for those westbound barrels than it does for Asia.