Saudi Aramco has informed multiple European oil-refining clients that they won't receive any crude shipments next month following an attack on the kingdom's crucial Red Sea pipeline, according to Bloomberg News. Under normal circumstances, European buyers receive consistent monthly crude supplies from Saudi Arabia, however, next month's deliveries are being suspended across the board for all European customers, the report said.
The disruption comes after a debilitating drone strike from Iraq-based militias and attacks from the Iran-backed Yemeni Houthis that forced Saudi Arabia to shut down its East-West pipeline. They were using the pipeline to get around the Strait of Hormuz which has been a tough passage since the US-Iran war began in March.
European refiners usually draw Saudi crude from the port of Sidi Kerir on Egypt's Mediterranean coast, which links to the Red Sea through a pipeline. The East-West Pipeline had been carrying around 5 million barrels per day to the Red Sea port of Yanbu, which is around 4 to 5 percent of the world’s oil supply.
As of June, European countries had been importing 577,000 barrels of oil per day from Saudi Arabia.
US oil price was starting to climb on Friday in the pre-market numbers as the news broke of the halting of oil from the Saudis to Europe, an indicator that Europe may have to turn more to the US for oil supply. Oil had already hit over $100 per barrel, sending gas prices soaring.
The strikes from the drones on the oil pipeline take place as part of a wider conflict between Iran and the US, with US-allies being dragged in at times. The Houthis are a terrorist organization in Yemen backed by the Iranian regime. Oil prices have shot up as a result of the Iran war with the closing down of the Strait of Hormuz. The pipelines from Saudi Arabia were another oil chokepoint for the oil supply.
The disruption comes after a debilitating drone strike from Iraq-based militias and attacks from the Iran-backed Yemeni Houthis that forced Saudi Arabia to shut down its East-West pipeline. They were using the pipeline to get around the Strait of Hormuz which has been a tough passage since the US-Iran war began in March.
European refiners usually draw Saudi crude from the port of Sidi Kerir on Egypt's Mediterranean coast, which links to the Red Sea through a pipeline. The East-West Pipeline had been carrying around 5 million barrels per day to the Red Sea port of Yanbu, which is around 4 to 5 percent of the world’s oil supply.
As of June, European countries had been importing 577,000 barrels of oil per day from Saudi Arabia.
US oil price was starting to climb on Friday in the pre-market numbers as the news broke of the halting of oil from the Saudis to Europe, an indicator that Europe may have to turn more to the US for oil supply. Oil had already hit over $100 per barrel, sending gas prices soaring.
The strikes from the drones on the oil pipeline take place as part of a wider conflict between Iran and the US, with US-allies being dragged in at times. The Houthis are a terrorist organization in Yemen backed by the Iranian regime. Oil prices have shot up as a result of the Iran war with the closing down of the Strait of Hormuz. The pipelines from Saudi Arabia were another oil chokepoint for the oil supply.
