Saudi Arabia Shuts Key East-West Pipeline Following Attacks, Escalating Global Energy Crunch

Oil prices have surged after Saudi Arabia halted operations on its major East-West crude pipeline following recent attacks.

According to a Bloomberg report, the attacks cut off a vital bypass around the troubled Strait of Hormuz, deepening a worldwide energy crisis.

Global benchmark Brent crude rose toward $108 a barrel after gaining nearly 9% last week, while West Texas Intermediate neared $103. European natural gas prices also spiked, rising as much as 3.8%.

Saudi officials announced late Friday that the East-West pipeline was closed as a precautionary measure following strikes the previous day.

Authorities gave no timeline for when the link, which has a capacity of about 7 million barrels per day and carries crude across the country to Red Sea ports, would resume operations.

"It all boils down to the duration," said June Goh, senior oil market analyst at Sparta Commodities SA. Goh noted that while short-term disruptions could be offset by tapping inventories at the western terminal of Yanbu, an extended outage would force crude output cuts.

The pipeline closure comes amid heightened geopolitical turbulence stemming from the ongoing U.S.-Iran conflict. Crude prices have surged 77% this year as fighting disrupted regional exports and unsettled shipping markets.

With Tehran and Washington battling for control over the Strait of Hormuz, the East-West line had served as a primary alternative route to maintain supply flows.

Diplomatic efforts to safeguard transit hit immediate setbacks Monday, with a planned meeting between Iran and several Gulf nations to discuss a temporary Hormuz shipping lane postponed, according to Omani Foreign Minister Badr Albusaidi.

Bahrain declined to attend, citing the pipeline attack, while reports indicated Saudi Arabia also held reservations.

Meanwhile, Iraq moved to contain fallout from the strike after investigations revealed the attack was launched from within its borders.

The escalating military friction extends to Yemen's Red Sea coast, where rapid advances by Iranian-backed Houthi militants threaten greater control over the Bab el-Mandeb strait.

In response, U.S. Treasury Secretary Scott Bessent signaled stepped-up economic pressure, promising new sanctions against a major bank to target Tehran.