Saudi Aramco halts October crude deliveries to European refiners after pipeline strike

Pipeline strikes halt Red Sea flows

A drone attack around 10 September damaged three pumping stations along Saudi Arabia's 1,200-kilometer East-West Pipeline, forcing a shutdown of the link that carries crude across the peninsula to the Red Sea port of Yanbu. Industry assessments indicate that 3 of the line's 11 pumping stations sustained damage, with satellite imagery confirming the strikes. The pipeline previously moved between 4 million and 5 million barrels per day, accounting for 4% to 5% of global crude supply and providing an export route around the Strait of Hormuz. No crude shipments have left Yanbu since 11 September, as terminal storage levels dwindled to a few days of reserves. Operators expect a partial restart within days, while full repairs are projected to take five to six weeks.

Delivery cancellations across Europe

Saudi Aramco notified European refiners on 18 September that crude deliveries scheduled for October are suspended under regular monthly term contracts. The decision follows earlier cancellations and delays of September shipments, affecting multiple buyers that receive crude via Egypt's Sidi Kerir terminal on the Mediterranean. At least three European refiners received formal notice of cancelled or delayed deliveries, with notifications expected for at least two additional facilities. European buyers are seeking prompt replacement cargoes from North Sea and Mediterranean markets, creating a pricing gap between crude benchmarks and physical cargoes.

Market price divergence and refinery exposure

Physical crude deliveries in Europe reached approximately $122 per barrel, creating a $14 spread over Brent crude futures, which traded near $108 per barrel before easing below $105 per barrel on 17 September. The supply disruption creates uneven exposure across European refiners. Poland's PKN Orlen relies on Saudi Aramco for approximately 40% of the crude processed across its three refineries. By contrast, Germany maintains low direct exposure, with Saudi crude representing 0.8% of German imports in 2025. German refiners source the bulk of their imports from Norway at 16.6%, the United States at 16.4%, and Libya at 13.8%.

Alternative routing through the Persian Gulf

To offset lost export capacity on the Red Sea, Saudi Aramco redirected crude flows eastward to its Ras Tanura export terminal on the Persian Gulf. Traders reported that the company sold approximately 60 million barrels of crude from Ras Tanura for September and October loading, representing an average flow of 1 million to 1.5 million barrels per day. These volumes are scheduled for ship-to-ship transfers off the port of Sohar in Oman before reaching Asian and other regional buyers. Meanwhile, the Petroleum Association of Japan stated that Japanese refiners have secured sufficient crude supplies through November despite ongoing regional security risks.