Oil prices rise 2% on Saudi pipeline risks

• Oil prices increased nearly 2% as concerns grew over supply disruptions after attacks affected Saudi Arabia’s East-West pipeline.
• Brent crude futures rose $1.87 to $107.55 per barrel, while WTI futures gained $1.88 to $103.27 per barrel.
• Markets remained focused on whether Saudi Arabia can restore pipeline operations and reduce risks around Gulf oil shipments.

Oil prices rose on Tuesday as supply concerns increased after attacks on Saudi Arabian energy infrastructure disrupted the East-West pipeline, with Brent crude futures gaining 1.77% to $107.55 a barrel and West Texas Intermediate (WTI) futures rising 1.85% to $103.27 a barrel.

The price increase followed renewed concerns about Middle East supply risks after Iran-backed Houthi forces launched attacks on Saudi Arabia, while Gulf states delayed planned discussions with Iran amid uncertainty over the broader regional conflict.

“Oil traders are treating every fresh attack or infrastructure hit as an incremental supply risk, while staying highly sensitive to any sign that the East-West pipeline or Hormuz flows could normalise,” said Tim Waterer, chief market analyst at KCM Trade.

The disruption affected Saudi Arabia’s East-West pipeline, which allows exports to bypass the Strait of Hormuz, and traders estimated the outage could threaten up to 4 million barrels per day of Saudi export capacity if operations are not restored.

Following the announcement, Brent crude futures were up 1.77% at $107.55 per barrel and WTI futures increased 1.85% to $103.27 per barrel, while ING analysts said uncertainty over the pipeline damage and outage duration could keep prices supported.

Saudi Arabia uses the East-West pipeline to transport about 4 million barrels per day to the Red Sea port of Yanbu, allowing the world’s largest oil exporter to reduce reliance on the Strait of Hormuz for shipments.

Global oil markets have remained sensitive to geopolitical developments, with vessel traffic through the Strait of Hormuz falling to four ships on Monday from 10 a day earlier, according to preliminary Kpler data, while China’s oil throughput increased for a second consecutive month in August after export restrictions were eased.