Saudi Arabia to Raise Pipeline Capacity to 10 Million bpd to Bypass Hormuz

Saudi Arabia plans to raise the capacity of its East-West pipeline, the overland route that lets it bypass the Strait of Hormuz, to 10 million barrels per day (bpd) within two to three years, according to Energy Minister Prince Abdulaziz bin Salman, speaking at the WPC Energy congress in Riyadh as reported by OilPrice. The pipeline, which runs 1,200 kilometers between the eastern oil region and the port of Yanbu on the Red Sea, currently carries around 5.8 million bpd and has a current ceiling of 7 million.

The announcement comes as Brent crude topped 106 dollars, its highest level in nearly a month, following Houthi attacks on Riyadh airport and strikes on tankers near Hormuz and Oman. The maritime route concentrates close to a fifth of the oil traded worldwide, and its benchmark price sets the price of Mexico's export blend: Petróleos Mexicanos (Pemex) reported a close of 102.45 dollars per barrel on September 25, its highest level since the 17th of that month.

Bloomberg Línea details that the expansion has two phases: within seven or eight weeks Saudi Aramco could add 1.2 million bpd by temporarily reassigning an existing gas pipeline to crude pumping, and modernizing the East-West pumping stations would add up to 3 million bpd more. The gas-to-crude conversion would operate until May, when the pipeline must be cleaned and returned to domestic gas supply. Prince Abdulaziz said the kingdom is holding talks with Kuwait, among other countries, about additional export routes.

The alternate corridor does not eliminate the risk: the Houthis have warned they can disrupt Saudi shipments through the Bab el-Mandeb strait, the shortest exit from Yanbu toward Asia. For Mexico, the effect works through two channels: expensive crude sustains the export value of Pemex, while the cost of gasoline and diesel imported from U.S. Gulf refineries rises in the same proportion. The next data point to watch is the volume Aramco reports in its October monthly update.

This article was written with the assistance of artificial intelligence from verified sources and reviewed by a human editor before publication.