"Saudi Arabia Partially Resumes East-West Crude Oil Pipeline Operations... Full Restoration Will Take Another 6–8 Weeks"

[Financial News]  

Major international media outlets reported on the 22nd local time that Saudi Arabia had begun trial operations to restart the damaged Petroline. Reuters reported that operations had resumed and that crude oil exports from Yanbu Port on the Red Sea could restart as early as late that day. However, a full-scale resumption of exports is expected to take more time.
According to Reuters, a source said, "Crude oil supplies to Saudi Aramco's refining facilities along the Red Sea will resume," adding, "A tanker bound for China is scheduled to be loaded with crude at Yanbu Port late today."
According to the Financial Times (FT), the pipeline linking Saudi Arabia's major oil fields in the east with Yanbu Port, a Red Sea port city in the west, stretches 1,200 kilometers and has an official crude oil transport capacity of approximately 7 million barrels per day.
Jun Gao, an analyst at Sparta Commodities, said that if only 25% of the pipeline's transport capacity were restored, there would be no crude available for export because refineries in western Saudi Arabia would consume the entire volume. He projected that exports could reach 1 million barrels per day if 40% of the capacity were restored.
A source said, "It will take several days to restore 40% of capacity, and six to eight weeks to fully resume pipeline operations."
Most of the crude exported from Yanbu Port is bound for European markets. As a result, European refiners were notified last week that they would not receive their October allocations.
Saudi Arabia's Petroline was damaged and shut down in a drone attack by the Houthi rebels in Yemen on the 10th.
Brent Crude Oil for November delivery, which had plunged nearly 3% during the session to $97.43 a barrel following news of the pipeline's restart, later pared its losses and traded at $99.81 a barrel in afternoon trading.
Selling was curbed after U.S. President Donald Trump said in a speech at the United Nations General Assembly that an agreement with Iran would be reached after the midterm elections.
West Texas Intermediate crude oil (WTI) October futures rose 0.7% to $96.40 a barrel.


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