Houthi Strikes Threaten Saudi Oil Infrastructure Amid Rising Prices
Recent Houthi strikes on Saudi Arabia’s oil infrastructure have raised concerns over the stability of Middle Eastern crude exports. The East-West pipeline, which handles up to seven million barrels per day (b/d), has been damaged and is now at risk of further disruption, potentially cutting off three to four million b/d in exports. This development has already pushed Brent crude prices above $105 per barrel while some Middle Eastern grades have surged past $120 per barrel. In response to the ongoing tensions, OPEC revised its 2026 global oil demand growth forecast downward for a fifth consecutive month, now predicting an increase of just 380,000 b/d. The group expects stronger recovery in 2027 with projected gains of 2.36 million b/d. Meanwhile, geopolitical tensions are also affecting other energy markets: European gas prices hit their highest level since early 2023 due to fears over Russian LNG output and supply disruptions. The situation is further complicated by a broader global context where US diesel stocks are expected to reach a 23-year low while South Africa plans to expand its refining capacity in an effort to reduce fuel imports. Australia has also adjusted its gas reservation policy, aiming to boost liquefied natural gas (LNG) exports.
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Topics: Brent_crude Houthi_strikes oil_prices OPEC_forecast Saudi_oil_infrastructure