Saudi Arabia Shuts Its Main Hormuz-Bypass Pipeline After Drone Strikes From Iraq, Putting 4-5% of Global Oil Supply at Risk

Saudi Arabia shut down its 1,200km East-West ('Petroline') pipeline on Sep 11 as a precaution after several drones launched from Iraq's Maysan province struck the line in the Riyadh and Medina sectors, sparking fires; satellite imagery from Planet Labs showed damage to a facility in the Hejaz region. The pipeline, with a full pumping capacity of roughly 7 million bpd, had been moving 4-5 million bpd (4-5% of global supply) from the Abqaiq oilfield to the Red Sea export terminal at Yanbu -- Saudi Arabia's primary route for bypassing the Iranian-contested Strait of Hormuz. An Iraqi military commander was dismissed after investigations confirmed the drones originated from Iraqi territory; an umbrella group of Iran-backed Iraqi militias denied involvement. Brent crude, trading above $104/bbl versus $72 before the Feb 28 war began and a $119 wartime peak, extended its gains on the news, and US diesel prices hit all-time highs. One analyst said 'there's less slack in the system, everything is running hot,' warning that 'the key buffers that got us through the last six months have basically been worn away.'