Chinese oil prices reach record highs after Saudi pipeline attacks

Chinese crude oil futures just hit a price nobody wanted to see. On September 15, yuan-denominated crude on the Shanghai International Energy Exchange surged to 929.4 yuan, roughly $138.50 per barrel. That’s the highest level since the contract launched in March 2018. The catalyst: a series of drone attacks on Saudi Arabia’s East-West pipeline. The pipeline was moving approximately 4 million barrels per day, which accounts for about 4% of global oil supply. What happened to the pipeline On September 10 and 11, drone strikes attributed to Iran-aligned militias operating out of Iraq hit the East-West pipeline in multiple locations. The damage was severe enough that Saudi Arabia temporarily halted operations on the entire route. Repair estimates put the timeline at four to six weeks. The East-West pipeline had become even more critical in recent months because it offered an alternative export route that bypasses the Strait of Hormuz. With US-Iran tensions already making that narrow waterway a risk zone for tanker traffic, Saudi crude was being rerouted through the pipeline to Red Sea terminals instead. Knocking it offline eliminated the workaround. Global benchmarks feel the heat Bren...