International oil prices pulled back on Thursday (September 17), falling about 1%, but benchmark prices still held above the US$100-per-barrel mark. Markets were closely watching the real threat posed by continued fighting between Saudi Arabia and Yemen’s Houthis, while also being buoyed by news that Saudi Arabia is expanding crude supply and actively seeking to restore part of the capacity of its east-west pipeline, easing earlier concerns about a Middle East supply disruption.
Brent crude futures in London fell US$1.01, or 0.95%, to US$104.82 per barrel.
US West Texas Intermediate (WTI) crude futures in New York fell US$0.52, or 0.50%, to US$101.91 per barrel.
Saudi Arabia is racing to restore about half of the capacity of its east-west pipeline within days. The roughly 1,200-kilometer pipeline carries crude produced in the eastern oil fields directly to the Red Sea port of Yanbu, and with shipping through the Strait of Hormuz continuing to be disrupted, it serves as a vital alternative lifeline for Saudi Arabia’s crude exports.
However, Reuters, citing satellite imagery and three industry sources, reported that when the east-west pipeline was attacked last week, three pump stations were actually damaged — worse than the two previously assessed. Industry views differ on the timeline for full repairs: three sources estimated it could take 5 to 6 weeks, while another source said some pumping capacity could be restored ahead of schedule during the repair period.
