🛢 Even Mideast’s oil chokepoints have chokepoints

Saudi Arabia’s 7M bpd nameplate capacity East-West Pipeline restarted operations on September 22, almost two weeks after its September 11 shutdown following mysterious drone attacks that no group has claimed responsibility for.

👉 Markets reacted positively, with crude prices, which had surged well past the $100 mark, slipping back down to the 90s.

But actual oil shipping out of Yanbu – the western terminal and endpoint of the 1.2k km mega pipeline, still isn’t back to full capacity. Tanker loadings began only days after the pipeline’s official return to operation, and ship-tracking and data intelligence firm Kpler revealed that a return to the ~5.5M bpd average being shipped before the shutdown would take another month.

➡️ Then there’s the gauntlet Saudi shipping still has to face while operating in the Red Sea – more vulnerable than ever in the south after the Houthis’ seizure of the entire Yemeni Red Sea coast and all of the area’s strategic islands, and at risk in the north as well to Houthi long-range missiles and drones.

War risk insurance surcharges have tripled, from 1% of a vessel’s value in July, before the Saudi attack on Sanaa airport that triggered a full-scale resumption of the Yemen war, to 3% now, according to insurance industry sources speaking to Reuters.

Yanbu also isn’t the only oil-loading port with problems, The Cradle points out. The Turkish Mediterranean port of Ceyhan, eyed by Iraq as an alternative to Hormuz, processes an average of just 200k bpd, 50k bpd less than it did before the Iran war, due to drone and missile attacks on Iraq’s northern oilfields by local militias and the IRGC.

And Baniyas, Syria’s largely defunct oil export terminal, which hopes to facilitate up to 2M bpd-worth of Iraqi exports using a new pipeline, is currently shipping just 50k bpd via overland tanker trucks driving Mad Max-style missions.

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