Saudi East-West Pipeline Underpins Kingdom’s Energy Security Strategy

The King Fahd Industrial Port in Yanbu. (SPA)
The King Fahd Industrial Port in Yanbu. (SPA)
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Saudi East-West Pipeline Underpins Kingdom’s Energy Security Strategy

The King Fahd Industrial Port in Yanbu. (SPA)
The King Fahd Industrial Port in Yanbu. (SPA)

As regional military tensions escalate and attacks on shipping in the Strait of Hormuz recur, Saudi Arabia’s East-West oil pipeline has re-emerged as a critical safeguard in the global energy system.

With markets closely watching threats to the vital maritime corridor, the Kingdom’s sovereign infrastructure is acting as a strategic shield to keep oil flowing. The moment underscores that Saudi Arabia’s logistical resilience and delivery capacity are as vital as its production strength, reinforcing its reputation as the most reliable supplier in times of turmoil.

In a statement to Asharq Al-Awsat, Saudi Aramco said it had adjusted crude oil shipping operations to prioritize safety and service continuity, and to help ensure reliability, by temporarily redirecting allocated volumes to the Yanbu port as an option for customers unable to access the Arabian Gulf.

“We remain fully committed to supporting and serving our customers and continue to assess the situation in order to resume normal procedures,” the company said.

Reuters earlier cited sources as saying Aramco was seeking to reroute some crude exports to the Red Sea to avoid the Strait of Hormuz, after the risk of attacks brought shipping traffic to a near halt.

The company has also informed some buyers of its Arab Light crude that cargoes would need to be loaded at Yanbu.

Sovereign infrastructure

The pipeline, known as Petroline, is more than a transport project. It is sovereign infrastructure built to protect Saudi crude flows from potential maritime disruptions.

The East-West pipeline carries crude from fields in Saudi Arabia’s Eastern Province to the Red Sea coast, where it is exported through King Fahd Industrial Port in Yanbu. Stretching about 1,200 kilometers across the Kingdom, it runs through several pumping stations capable of moving millions of barrels per day efficiently.

The line began operating in the early 1980s during a period of heightened regional security concerns, when fears were growing over threats to shipping in the Strait of Hormuz, a route that carries about one-fifth of global seaborne oil trade.

The project had three clear aims: to provide an export outlet outside the Arabian Gulf, to strengthen Saudi energy security, and to reassure global markets about the continuity of supply.

Today, the pipeline has a capacity of about five million barrels per day, far above its initial capacity at launch. That scale gives Saudi Arabia significant logistical flexibility to redirect exports quickly in response to geopolitical or operational disruptions.

Operated by Saudi Aramco, the line is managed through advanced monitoring systems that efficiently regulate crude flows, alongside strict technical and security safeguards.

Why it matters now

Financial and economic adviser Dr. Hussein Al-Attas told Asharq Al-Awsat the pipeline linking the Eastern Region to Yanbu is among the most important strategic infrastructure projects in Saudi Arabia’s energy sector.

Its capacity of roughly five million barrels per day provides the kingdom with high logistical flexibility if disruptions occur in the Arabian Gulf or the Strait of Hormuz, he said.

Amid geopolitical tensions, having an export outlet far from maritime chokepoints reduces operational risks and strengthens the Kingdom’s ability to honor long-term supply contracts.

It is impossible to speak of zero disruptions in absolute terms, but the pipeline significantly reduces risks and makes the likelihood of widespread disruption to Saudi exports very low compared with many other producers, Al-Attas said.

He added that Petroline has evolved from a logistics project into a tool of economic national security.

What was once an oil transport project designed to improve export efficiency has become part of the Kingdom’s economic national security architecture, he said.

Aramco now treats it not only as an alternative route but as a strategic option that diversifies export outlets, reduces reliance on sensitive maritime passages, protects oil export revenues and strengthens reliability for customers in Asia and Europe.

Al-Attas stressed that delivery capability is as important as production capacity, noting that the pipeline’s strategic value lies in ensuring supply even under the most difficult conditions.

During wars or regional tensions, markets rapidly price in risk, he said. The presence of an effective alternative route gives Saudi Arabia a competitive edge by helping ease the risk premium on its crude compared with producers reliant on a single export route.

It also reinforces investor confidence in the stability of Aramco’s cash flows and strengthens the Kingdom’s image as a long-term reliable supplier—an important factor in futures markets.

The more Saudi Arabia proves it can maintain supplies even in the toughest circumstances, the more global markets will see it not only as the largest oil exporter but also as the most reliable and stable, Al-Attas said.

He stressed that the East-West pipeline is no longer just crude transport infrastructure. It is now a strategic pillar that protects revenues, supports financial stability and strengthens Saudi Arabia’s geopolitical weight in the global energy security equation.



Saudi Arabia Encourages Companies to Import Lebanese Products After Royal Order

 Saudi Ambassador to Beirut Fahd Al-Dosari and officials from both countries at Beirut port at the launch of Lebanese exports to Saudi Arabia. (SPA)
Saudi Ambassador to Beirut Fahd Al-Dosari and officials from both countries at Beirut port at the launch of Lebanese exports to Saudi Arabia. (SPA)
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Saudi Arabia Encourages Companies to Import Lebanese Products After Royal Order

 Saudi Ambassador to Beirut Fahd Al-Dosari and officials from both countries at Beirut port at the launch of Lebanese exports to Saudi Arabia. (SPA)
Saudi Ambassador to Beirut Fahd Al-Dosari and officials from both countries at Beirut port at the launch of Lebanese exports to Saudi Arabia. (SPA)

Saudi Arabia has officially begun encouraging its private sector to import Lebanese goods, a concrete step to revive trade between the two countries after years of disruption.

The step implements directives from Prince Mohammed bin Salman, Crown Prince and Prime Minister, and follows a request from Lebanon’s presidency and government.

Beirut port recently saw the first shipment leave for the Kingdom, in a ceremony officials said marked the rebuilding of economic trust, backed by modern and strict security controls to safeguard exports.

According to information obtained by Asharq Al-Awsat, Saudi Arabia’s General Authority of Foreign Trade informed the Federation of Saudi Chambers that a royal order had approved the resumption of Lebanese exports to the Kingdom.

It asked that the decision be circulated across the private sector so companies could benefit from it.

The move is expected to spur Saudi companies to tap the Lebanese market and push trade between the two countries toward broader horizons in line with their ambitions.

First export shipment

Acting on the Saudi royal order, Lebanese products were shipped again to Saudi Arabia on June 20, in the presence of the Saudi Ambassador to Lebanon, Fahd Al-Dosari. The shipment carried more than goods and merchandise.

It carried “a message of trust rebuilt after years of disruption, and an economic opportunity Lebanon eagerly awaits at a time when the need to stimulate production and increase exports is growing.”

The return of the Saudi market, which alone represents about 85% of the Gulf market, is not only a recovery of what was lost when exports stood at about $378 million before the ban. It also opens the door to greater ambitions to expand Lebanon’s presence in this vast market.

Al-Dosari said in a speech: “In implementation of the directives of Crown Prince Mohammed bin Salman to resume Lebanese exports to the Kingdom, and in response to the request of Lebanese President General Joseph Aoun and Prime Minister Nawaf Salam, and in line with the positive steps taken by the government toward rebuilding state institutions and the work completed by the specialized teams, we gather today to witness the departure of the first exports bound for Jeddah Islamic Port through Beirut port.”

He added: “As an embodiment of brotherly relations and out of the Kingdom’s keenness to stand by its brothers, this decision to resume Lebanese exports to the Kingdom confirms beyond doubt its support for Lebanon’s stability, its sovereignty over all its territory and the welfare of its brotherly people.”

Security screening

Prime Minister Nawaf Salam said Lebanon would not be allowed to again become “a launchpad for any harm against its Arab brothers,” and thanked Crown Prince Mohammed for lifting the ban on Lebanese exports.

The attendees then inspected modern scanning devices recently installed at Beirut port to examine goods and containers with precision. The equipment is designed to tighten security controls and speed up customs clearance.

Saudi Arabia had been Lebanon’s top export market before the ban. In 2014 and 2015, it ranked first, accounting for about 12% of Lebanon’s total exports, with a value of around $378 million in 2014, according to Lebanese customs and Chamber of Commerce data.

Bilateral trade was estimated at hundreds of millions of dollars annually.


Türkiye and Iraq Discuss Energy Cooperation Ahead of Pipeline Deal Expiry

A general view of Türkiye's Mediterranean port of Ceyhan, Adana, southern Türkiye, Feb. 19, 2014. (Reuters)
A general view of Türkiye's Mediterranean port of Ceyhan, Adana, southern Türkiye, Feb. 19, 2014. (Reuters)
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Türkiye and Iraq Discuss Energy Cooperation Ahead of Pipeline Deal Expiry

A general view of Türkiye's Mediterranean port of Ceyhan, Adana, southern Türkiye, Feb. 19, 2014. (Reuters)
A general view of Türkiye's Mediterranean port of Ceyhan, Adana, southern Türkiye, Feb. 19, 2014. (Reuters)

Türkiye's ‌Energy Minister Alparslan Bayraktar said on Wednesday that he met senior Iraqi oil and foreign ministry officials to discuss energy cooperation, including on the Iraq-Türkiye Crude Oil Pipeline that runs from Kirkuk to Ceyhan.

The decades-old Türkiye-Iraq Crude Oil ‌Pipeline Agreement, which governs ‌exports through the ‌pipeline, ⁠is due to ⁠expire on July 27. Baghdad and Ankara are still discussing a new draft agreement.

The Iraqi delegation included Deputy Foreign Minister Hussein Bahr Al-Uloom, Deputy ⁠Oil Minister Naser Azez ‌Jabbar, and ‌Iraq's Ambassador to Ankara Majid Al-Lachmawi.

Bayraktar said in a ‌post on X that Türkiye aims to work closely with the new Iraqi government on more effective ‌use of existing energy infrastructure.

Türkiye also seeks to ⁠support ⁠existing infrastructure with new connections, Bayraktar said.

Baghdad last month asked Ankara to extend the pipeline agreement for at least a year to allow time for more talks, but Ankara said it does not want an extension under current conditions.


Gold Falls as Higher Treasury Yields, Fed Rate Hike Bets Weigh

Gold bracelets and necklaces displayed for sale in a gold shop at Istanbul's Grand Bazaar (AFP)
Gold bracelets and necklaces displayed for sale in a gold shop at Istanbul's Grand Bazaar (AFP)
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Gold Falls as Higher Treasury Yields, Fed Rate Hike Bets Weigh

Gold bracelets and necklaces displayed for sale in a gold shop at Istanbul's Grand Bazaar (AFP)
Gold bracelets and necklaces displayed for sale in a gold shop at Istanbul's Grand Bazaar (AFP)

Gold fell for a third consecutive session on Wednesday, as rising US Treasury yields and growing bets that the Federal Reserve will raise interest rates pressured the non-yielding metal.

Spot gold was down 0.8% at $3,974.75 per ounce as of 0849 GMT, after touching its lowest level since last November at $3,942.99 in the previous session. US gold futures for August delivery lost 1.3% to $3,987.70/oz.

The yellow metal ‌on Tuesday recorded ‌its first quarterly loss since January 2024, Reuters reported.

A selloff ‌in ⁠US Treasuries on ⁠Tuesday pushed the benchmark 10-year yield up as much as 9 basis points before it backed off the highs. By Wednesday, yields were rising again, up 4 bps at 4.465%, outpacing increases in euro zone bond yields.

A stronger US dollar makes bullion less affordable for overseas buyers.

"The weakness is a bit driven by comments from ⁠Fed's Hammack, suggesting a rate hike might be ‌needed and market participants pricing in ‌a bit more rate hikes for this year," said UBS analyst Giovanni Staunovo. Federal ‌Reserve Bank of Cleveland President Beth Hammack said on Tuesday ‌she may advocate for higher rates if inflation pressures don’t moderate. According to CME FedWatch tool, traders see a nearly 67% chance of a rate hike by September.

Expectations for more hikes are not helping investment demand, and ‌ETF holdings have seen renewed outflows in recent days, said Staunovo, noting that price volatility is ⁠expected around economic ⁠data releases this week.

June ADP employment data, due at 1215 GMT, and Thursday's nonfarm payrolls report could give further clues on the Fed's policy path.

Markets will also closely watch the European Central Bank's annual Sintra conference on Wednesday, where Fed Chair Kevin Warsh and ECB President Christine Lagarde are due to speak. On the geopolitical front, concerns persisted over the prospects for US-Iran diplomacy after Tehran said it would not meet senior US envoys who travelled to the region following the recent outbreak of hostilities.

Spot silver fell 1.4% to $57.75 per ounce.

Platinum slipped 0.6% to $1,542.70, after hitting its lowest point since November. Palladium slid 1.4% to $1,187.01.