Saudi Aramco resumes full oil supply to European customers, reducing alternative procurement pressure for European refineries

Saudi Aramco will resume full crude oil supply to European refiners in November, marking the near resolution of supply disruptions caused by previous pipeline attacks and promising to ease market tensions.

On October 9, according to sources cited by Bloomberg, at least three European refiners have been notified that they will receive their full crude oil allocations from Saudi Aramco in November.

Previously, after Saudi Arabia’s East-West pipeline was attacked by drones, Saudi Aramco informed its European clients that no crude oil allocations would be provided in October, forcing buyers to urgently seek alternative supplies.

The resumption of supply will directly relieve the supply pressure in the European crude oil market. Orlen SA, Poland's largest Saudi crude oil buyer, issued more than ten tenders for alternative barrels during the supply outage. According to Bloomberg ship tracking data, Saudi oil exports to Europe typically average between 700,000 to 800,000 barrels per day.

Last month, the East-West pipeline in Saudi Arabia was attacked by drones launched from Iraq, forcing the pipeline to cease operations.

By the end of last week, Saudi Aramco had restored more than 80% of the East-West pipeline’s capacity. On Monday, there were reports of another attack at a pump station along the pipeline resulting in another shutdown, causing oil prices to jump over 1.2%. However, subsequent reports cited sources confirming normal pipeline operations, and oil price gains narrowed accordingly.

This pipeline is a key cross-border oil artery for Saudi Arabia, with a daily transport capacity of 7 million barrels. During the Iran war, it served as a crucial export route bypassing the risks of the Strait of Hormuz and ensuring continued crude oil export.

As of last week, after subtracting the internal supply needed for west coast refineries, Saudi Aramco had about 4.5 million barrels per day of crude oil available for export.

Although the East-West pipeline has returned to normal operations, overall supply risks in the region have not been fully eliminated. In recent months, Houthi forces in Yemen have continued to attack oil tankers navigating the Red Sea and infrastructure along Saudi Arabia's west coast, putting ongoing pressure on this vital export route.