Saudi Arabia's Red Sea Oil Exports Surge: What New Pipelines Mean for Global Supply

Saudi Arabia has dramatically increased crude oil flows through its East-West Pipeline to 4.5 million barrels per day (bpd) available for export from Red Sea ports, the highest level recorded since the U.S.-Iran war began (Argusmedia). This surge in exports, occurring rapidly after the pipeline was operating at half capacity earlier in October, helps to ease supply pressures on global oil markets.

However, this strategic move comes amidst persistent Houthi attacks on Saudi oil infrastructure, highlighting the Kingdom's urgent need to secure its vital energy exports. For your business and the region, these developments mean both increased short-term supply stability and a long-term strategic shift to reduce reliance on vulnerable shipping lanes.

Why Saudi Arabia is boosting its Red Sea pipeline

Saudi Aramco is currently pumping approximately 6 million bpd through its East-West Pipeline, also known as Petroline, which has a maximum capacity of 7 million bpd (Argusmedia). After accounting for domestic refinery supplies, 4.5 million bpd are available for export from Red Sea terminals, notably Yanbu (Argusmedia). This route is crucial as it allows Saudi oil to bypass the Strait of Hormuz, a critical maritime chokepoint often threatened by regional tensions (Argusmedia).

This rapid increase in throughput follows a temporary shutdown in September 2026 due to a drone strike, with operations restarting later that month (Argusmedia). The restoration of these flows, alongside the Group of Seven's (G7) announcement to release fuel reserves, is putting downward pressure on international oil prices. Despite this, Brent Crude prices remain near $100 per barrel, significantly above pre-war levels (Argusmedia). Following the September disruption, Saudi Aramco had to cancel some October crude deliveries to European and Indian customers, redirecting volumes towards Asian markets via ports east of the Strait of Hormuz (Argusmedia).

Is an Oman bypass the next strategic move?

Looking ahead, Saudi Arabia is actively exploring an even more resilient export route. TotalEnergies CEO Patrick Pouyanné indicated in September 2026 that Saudi Arabia has "begun to work" on an oil pipeline to Duqm, Oman (Marketscreener). This project is currently in the feasibility study stage and could span around 1,000 kilometres, with an estimated cost of up to $7 billion (Marketscreener).

An Oman bypass pipeline would offer Saudi crude, especially barrels destined for Asian markets, a direct outlet to the Arabian Sea. This route would strategically avoid both the Strait of Hormuz and the Bab el-Mandeb Strait, another chokepoint that tankers from Yanbu must navigate (Marketscreener). Such a development would significantly bolster Saudi Arabia's export network, reducing its vulnerability to disruptions and enhancing its ability to meet global supply commitments. Oman is also strategically positioning itself, planning to more than double its oil storage capacity at Duqm to 10 million barrels within three years (Marketscreener).

The persistent threat of Houthi attacks

Despite these strategic infrastructure initiatives, Saudi Arabia continues to face relentless Houthi attacks on its oil facilities. In September 2026 alone, Houthis claimed missile and drone attacks on a "sensitive target" in Riyadh and Saudi Aramco facilities in Yanbu (Investing). Earlier that month, they targeted Riyadh for the first time in the current escalation, disrupting flights and causing smoke near King Khalid International Airport (Investing).

These attacks are part of the ongoing Yemeni civil war and are deeply intertwined with broader regional tensions, including the U.S.-Iran confrontation (Iranprimer.usip). The Houthis aim to pressure Saudi Arabia, disrupt energy supplies, and drive up global oil prices. The targeting of Red Sea routes specifically seeks to deny Saudi Arabia a secure alternative export corridor, thereby increasing pressure by disrupting energy supplies (OilPrice.com). These attacks elevate perceived maritime risk in the Red Sea and Gulf region, leading to higher insurance costs for commercial shipping and even prompting tankers to switch off tracking signals for "dark voyages" when loading crude from Saudi Red Sea ports (OilPrice.com).

The bottom line

Saudi Arabia is making significant strides to secure its crucial oil exports by maximising its East-West pipeline capacity and actively exploring a multi-billion dollar bypass through Oman. Whilst these efforts aim to enhance global supply security and reduce reliance on vulnerable chokepoints, the persistent threat of Houthi attacks underscores the ongoing instability that could impact oil prices and regional trade. The Kingdom's ability to sustain increased flows and develop new routes will be critical in navigating this complex energy landscape.

This article is for information only and is not financial advice.