A pipeline goes dark

Saudi Arabia shut its East-West pipeline on Friday after a drone strike it blamed on Iran-backed militias in Iraq. Two regional officials say repairs could take three to five weeks.

Built for exactly this

The 746-mile line runs from the Persian Gulf across the desert to the Red Sea. It was built in the 1980s because Riyadh feared Tehran would choke off the Strait of Hormuz during the Iran-Iraq war.

The workaround that worked

For the first six months of the current war, the pipeline kept Saudi crude moving while most tanker traffic in Hormuz sat frozen. Oil loaded at Yanbu went north via Suez or south through Bab el-Mandeb.

Four percent of world supply

Rystad Energy says 2.6 million to 4 million barrels a day have moved through the line since late August. Four million barrels is roughly 4% of global supply, per the IEA.

“a volume it said is now at risk of "disappearing from the market"”

Saudi output already sagging

The kingdom pumped nearly 10 million barrels a day in September 2025. By August it was down to 6 million. Inventories can cover exports for now, but Rystad warns that could change fast.

“Saudi inventories could sustain exports in the coming days, but that could "change quickly"”

Hormuz is the fallback now

Lloyd's List counted 90 transits through Hormuz in the first week of September, down from about 130 ships a day before the war. Thin, but open.

“But since the Hormuz route has opened back up, not completely but opened up some, it's not the death knell for Saudi Arabia.”

The Houthis close the south

Yemen's Houthis have seized islands along Red Sea routes and tightened their grip on Bab el-Mandeb. Melius Research figured 3 million barrels a day passed there in early September and says it is likely zero now.

“it's likely zero now”

Pump pain goes global

Nigerian diesel is 92% pricier than in late February, gasoline up 61%. Indonesia and Lebanon show similar spikes. US regular gas averages $4.32 a gallon, up 45% since before the war.

Diesel is the real tax

US diesel hit a record $6.23 a gallon, up 66%. It moves trucks, tractors and food, so the cost bleeds into everything. The crunch lands right before US harvest and heating season.

“An inflationary spillover is likely.”