Saudi Arabia cuts oil shipments to Europe after pipeline shutdown: Reuters

Saudi Arabia has reduced its oil shipments to Europe due to the shutdown of the East-West crude pipeline, as reported by Reuters. The disruption comes in the wake of drone attacks on the pipeline, which is crucial for transporting oil to the Red Sea port of Yanbu. This development has led to the suspension of September-loading cargoes, leaving European refiners, such as Poland’s Orlen, seeking alternative supplies. The pipeline outage has forced Saudi Arabia to rely on stored crude, with industry sources estimating that existing inventories can support exports for only five to seven days. Key Takeaways Market activity suggests increased perception of risk for crude oil supply, consistent with higher expected prices. The disruption appears to be prompting some refiners in Europe to seek alternative oil sources, indicating potential shifts in regional supply chains. Pricing indicates a heightened expectation that crude oil may reach new all-time highs by the end of the year, with December odds for such an event currently at 16.5%. What to Watch Observers will be closely monitoring developments related to the pipeline repairs and Saudi Arabia’s ability to restore normal oil flows. OPE...