Oil Price Relief Expected as Saudi Arabia Resumes Deliveries Through Damaged Pipeline

Oil traders are anticipating price drops as Saudi Arabia appears ready to resume deliveries through key East-West pipelines that allow oil to bypass the Strait of Hormuz.The pipelines to the Red Sea port of Yanbu had been closed since a drone attack earlier this month by Houthi militia damaged several pumping stations.Saudi oil workers have restarted operations and were hoping to get the pumping rate back to 4 million barrels per day, Reuters reported Tuesday. An unnamed source told the news outlet that it could take several weeks for a full resumption of flows.The Saudis built the two 746 mile pipelines during the Iran-Iraq War in the 1980s to bypass dangers in the Strait of Hormuz. They have a 7 million barrels a day capacity after one of the two pipelines — designed to transport natural gas — was converted this year to transport crude oil. About 4 percent of the global oil supply was flowing through the pipeline before the closure.Brent crude futures have dropped four days in a row and on Tuesday were briefly trading to below $96 a barrel, down from more than $100 a barrel last week. Prices have not been this low since September 8. Prices are still more than $10 a barrel more expensive than in late August.Multiple oil traders told Bloomberg that there are signs of tankers arriving in Yanbu to prepare for oil loadings. The resumption of oil flows through the pipeline will help ease global shortages that have driven up fuel prices.In America, gas prices are up $0.38 a gallon over last month and up $1.30 a gallon year-over-year, fuel data firm Gas Buddy reported. Diesel prices have also hit record highs and average $6.51 a gallon nationally. That’s up 77 percent from a year ago, according to Gas Buddy analyst Patrick De Haan. “We’ll see limited fuel price relief soon,” Mr. De Haan said in an X post.High gas prices are a concern for Republicans running in competitive Congressional races. Inflation and the cost of living is the top concern for American voters according to a poll released Monday. A majority of voters blame President Trump’s policies for hurting the economy.Oil traders are looking for other possible price relief. Iran is willing to reopen the Strait of Hormuz within seven days if America ends the blockade on Iranian ports, a senior Iranian official on Tuesday told Reuters.Iranian president Masoud Pezeshkian is part of a delegation at New York for the United Nations General Assembly and Mr. Trump is open to a meeting. “Trump is open to meeting with anybody at the UN. We are open to a meeting with Pezeshkian,” Mr. Rubio told NBC News. An Iranian official, however, said there are no plans for Mr. Pezeshkian to meet with Mr. Trump.Iran’s foreign minister, Abbas Araghchi, did meet with special envoy Steve Witkoff and Jared Kushner for three hours Tuesday on the sidelines of the assembly session. Mr. Trump called it a “very productive meeting” and they have another scheduled “in the very near future.” Mr. Witkoff was seated near Mr. Trump when he made the comments but didn’t respond to reporter questions.Around one fifth of the world’s oil normally travels through the Strait of Hormuz but those shipments have dropped dramatically since Iran started attacking tankers in the vital waterway. Before the Iran war about 125 tankers transported oil through the strait daily. That number has dropped to around 10 a day, data firm Kpler reported. On Monday, only two ships were known to transit the waterway, although the exact number of ships using the strait is hard to determine because some crews have been turning off navigation tracking equipment in an effort to avoid attacks.

Oil Price Relief Expected as Saudi Arabia Resumes Deliveries Through Damaged Pipeline

Oil Price Relief Expected as Saudi Arabia Resumes Deliveries Through Damaged Pipeline

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