- Brent crude prices rose to $110 per barrel on Monday due to pipeline issues
- Saudi Arabia's East-West pipeline was attacked and will be out of service
- The pipeline helped diversify oil flow away from the Strait of Hormuz
Brent crude prices spiked to $110 per barrel on Monday, after reports said that Saudi Arabia's East-West pipeline, which came under attack this week, will remain out of service for a considerable time to come.
The benchmark was up around 5% as attacks and the closure of a key Saudi pipeline added to the impact of the Iran war.
The immediate trigger was Saudi Arabia's shutdown of its 1,200-km East-West pipeline after drone strikes launched from Iraqi territory damaged the crucial oil route.
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The pipeline can transport up to 7 million barrels per day and allows Saudi crude to reach the Red Sea while bypassing the Strait of Hormuz.
The outage is expected to last several weeks. The Associated Press reported that repairs could take three to five weeks, although partial operations could resume sooner.
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The disruption comes as tanker traffic through Hormuz remains sharply below normal levels amid the conflict.
Diplomatic efforts to ease the supply crisis also suffered a setback. A planned meeting between Iran and Gulf states in Oman on Monday was postponed, reducing hopes of an immediate arrangement to improve shipping through the Strait of Hormuz.
Saudi Arabia's own production has already fallen sharply. OPEC data showed August output dropped 1.9 million barrels per day to 6.238 million bpd, the lowest level reported since 1990.
Demand pressures are adding to the market strain. China increased crude purchases in August as inventories declined, while the US Strategic Petroleum Reserve remains near historically low levels.
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With both major Gulf shipping routes facing disruption, traders are now assessing how long existing inventories can cushion the supply shock.
The longer the pipeline remains offline and Hormuz traffic stays restricted, the greater the risk of further crude price spikes.
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