Saudi Arabia eyes 10M bpd pipeline route around Hormuz

Saudi Arabia is looking at ways to raise its pipeline capacity to destinations outside the Persian Gulf to 10 million barrels a day within two to three years, Energy Minister Prince Abdulaziz bin Salman said Monday at the WPC Energy Congress in Riyadh. The plan comes as the kingdom fights off waves of Houthi attacks on its energy and aviation infrastructure.gcaptain+1

"We may end up with 10 million barrels within the next two to three years," the minister told the congress, according to Bloomberg. "We are improving the pump stations of the East-West pipeline."gcaptain

A temporary gas-to-oil conversion

Part of the plan is to repurpose a domestic gas pipeline to carry crude. Prince Abdulaziz said the line could move about 1.2 million barrels a day within seven to eight weeks, and further investment could raise that to 3 million. The arrangement would be temporary at first. He said he had told Saudi Aramco CEO Amin Nasser that the line could carry oil until May. After that it would need to be cleaned and switched back to supplying gas at home for the summer. He said the ministry and Aramco are installing pumping stations and compressors so the pipeline can carry either oil or gas as needed.annahar+1

Nasser said Aramco is also studying, with the energy ministry, more crude export options and more storage outside the kingdom.english.aawsat

The pipeline's role in the war

The East-West pipeline connects the oil fields in the east to the Red Sea port of Yanbu, which lets Saudi exports avoid the Strait of Hormuz. It has been the kingdom's main export route since the US-Iran war began. It was carrying 5.8 million barrels a day as of Oct. 6, after operations resumed following a drone attack in September. The minister said using the pipeline during the crisis had more than paid back its cost. He traced its origins to the early 1980s, when King Fahd ordered alternative export routes to be built.tradearabia+1

The announcement came two days after a Houthi strike on Riyadh's King Khalid International Airport on Oct. 10. Energy News Beat reported that the attack killed at least 13 people. At the same congress, US Energy Secretary Chris Wright said crude flows through Hormuz had recovered to 80% to 90% of pre-conflict levels. Flows of refined products were at 25% to 35%.energynewsbeat+1

Looking ahead

OPEC Secretary General Haitham Al Ghais called the pipeline "an insurance policy for energy security." He said OPEC expects oil demand growth of 1.7 million barrels a day in 2027, after it cut its 2026 estimate to 400,000 barrels a day. Prince Abdulaziz started his remarks by saying that "the word fear in the Saudi dictionary does not exist."english.aawsat