Oil slips to $98 as Saudi Arabia restarts East-West oil pipeline

Saudi Arabia has restarted its East-West pipeline, also known as Petroline, and resumed its crude exports from the Red Sea port of Yanbu later on Tuesday. Oil prices eased at the development, with Brent Crude futures falling by 1.52 per cent, slipping below $98 per barrel, the lowest since September 8.

The pipeline would resume crude supply to ​Aramco refineries located ​on the Red ⁠Sea coast, Reuters reported, adding that one cargo was scheduled to load at Yanbu later ​on Tuesday. The person said it would be bound ​for ⁠China. The pipeline is pumping at a low rate after its restart. At its peak, Saudi Arabia used the pipeline to transport around 4 million barrels per day, around 4 per cent of the global oil supply, to Yanbu. According to the report, it would take weeks to resume transporting at full capacity.

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The East-West pipeline was targeted by Houthi drones on September 13, forcing Saudi Aramco to completely suspend the operation of the network, which pushed oil prices as high as $109.97. Houthis said that the attack was in response to what they called Saudi Arabia's criminal attempts to target Yemen's capital, Sanaa.

Fighting continues to rage in Yemen, with the Houthi rebels battling Saudi-backed government forces for control of strategic mountains near the Red Sea and the leader of the Iran-aligned group warning the United States against direct military involvement in the conflict. Houthis, who have seized Yemen's Red Sea coast, including the port of Mocha, are now battling to take the Kahboub Mountains in Taiz and Lahj provinces. The fighting has killed at least 674 people, including 154 people in the past two days and has displaced more than 158,000.