RIYADH, Sept. 18 (Xinhua) -- Escalating tensions across the Middle East are increasingly weighing on Saudi Arabia, one of the world's largest oil exporters.
As the ongoing U.S.-Iran conflict continues to disrupt shipping through the Strait of Hormuz, growing hostilities between Yemen's Houthi group and Saudi Arabia are also threatening Riyadh's oil export routes through the Red Sea, putting mounting pressure on Saudi Arabia's oil sector.
EASTERN ROUTE: HORMUZ TRAFFIC REMAINS SUBDUED
Like other major oil-exporting countries in the region, Saudi Arabia has traditionally shipped its crude oil from eastern ports into the Gulf and then through the Strait of Hormuz to international markets.
According to the International Energy Agency (IEA), an average of about 20 million barrels per day of crude oil and petroleum products passed through the Strait of Hormuz in 2025, accounting for roughly one quarter of global seaborne oil trade.
Since the United States and Israel launched joint strikes against Iran in February, Iran has effectively restricted traffic through the strait. The vital route remains far from normal to this day.
Recent data from maritime analytics firm Kpler highlights that only a handful of commodity-carrying vessels pass through the waterway daily, with a complete absence of Very Large Crude Carriers and Liquefied Natural Gas tankers on multiple days.
To mitigate the impact of disruptions in the Strait of Hormuz, Saudi Arabia had begun exploring alternative export routes, including the East-West Pipeline, which transports oil to Yanbu Port on the Red Sea coast of western Saudi Arabia for shipment through the Red Sea.
WESTERN ROUTE: A "SAFETY VALVE" BECOMES A RISK POINT
However, Saudi Arabia's alternative western route for oil exports has also come under increasing constraints as the conflict between Saudi Arabia and Yemen's Houthi movement has intensified.
Accusing Saudi Arabia of violating areas under their control in Yemen, the Houthis announced on July 20 a maritime ban on Saudi vessels transiting the Bab al-Mandab Strait. The group subsequently claimed to have carried out attacks on Saudi vessels passing through the strait.
As the conflict between the two sides intensified, the Houthis began launching attacks against targets inside Saudi Arabia, including oil facilities.
The Saudi Ministry of Energy said on Sept. 11 that the East-West pipeline had come under multiple attacks in the Riyadh and Madinah regions, causing injuries. The pipeline was subsequently shut down as a precaution.
Analysts noted that the pipeline had previously served as a strategic "safety valve" for Saudi Arabia but had itself become a vulnerable point in the oil supply chain.
As of Sept. 16, Saudi authorities had not announced an official timetable for restarting the pipeline.
U.S. officials have suggested that flows could resume within "days," while Reuters reported that full repairs might take five to six weeks. Goldman Sachs said market estimates for the repair period ranged from a relatively quick recovery to as long as about eight weeks.
The more significant impact of such attacks was their effect on confidence in global oil markets. Hamad Hussain, senior climate and commodities economist at Capital Economics, said renewed Houthi attacks on Saudi Arabia could alter investors' assessments of the severity and duration of the conflict.
LONG-LASTING REPERCUSSIONS
Pressure on both of Saudi Arabia's major crude export routes has already begun to spill over into physical oil trading.
At the same time, the inventory "buffer" that has helped the global crude market absorb supply shocks is being eroded, shifting market attention toward when the entire supply chain, from oil fields and pipelines to storage facilities, ports and international shipping lanes, can return to stability.
IEA data showed that global observed oil inventories fell by another 95 million barrels in August. Since the end of February, inventories have declined by a cumulative 507 million barrels, equivalent to an average draw of roughly 2.8 million barrels per day.
Adam Ritchie, chief economist at Shell Trading, said in Oslo on Wednesday that since the escalation of the Middle East conflict, the global market had lost about 1.6 billion barrels of crude oil and condensates as well as roughly 36 million metric tons of liquefied natural gas supplies.
Rising transportation costs are adding to the pressure.
Paul Bradshaw, a director at Emirates National Oil Company, said that cargo insurance costs for some vessels transiting the Strait of Hormuz had risen to 5 to 6 percent of cargo value, while additional war-risk premiums could reach as high as 10 percent.
Anders Opedal, chief executive officer of Norwegian energy company Equinor, said that if Middle Eastern supplies remain disrupted for an extended period, tighter energy markets and sharp price volatility could persist longer.
