The closure of Saudi Arabia's critical East-West pipeline, combined with record-low global inventories, has eliminated market safety nets and pushed crude prices to their highest levels since May.
Global oil markets face renewed volatility as drone attacks on Saudi Arabia's East-West pipeline threaten 4 million barrels per day of crude exports. With strategic reserves at multi-decade lows and market buffers exhausted, analysts warn that prices are likely to climb further as the Middle East conflict enters its seventh month.
The pipeline allows Saudi Arabia to bypass the Strait of Hormuz, providing a vital export route for crude oil to the Red Sea port of Yanbu.
Inventories are at their lowest levels in decades, with the IEA reporting a cumulative draw of 507 million barrels since February.