Lipow Oil AssociatesPrivate± Mixed
relevance
WTI surges over 4% after Saudi Arabia halts oil loading at Yanbu port
CommodityGeopolitics Impact 4
West Texas crude for October delivery closed up 4.44 dollars, or 4.38%, at 105.83 dollars a barrel, after crude oil loading at Saudi Arabia's Yanbu port on the Red Sea was suspended and Saudi Arabia cancelled some oil deliveries to European customers. Meanwhile, North Sea Brent crude for November delivery closed at 108.75 dollars a barrel, up 3.07 dollars, or 2.9%. Both contracts closed at their highest levels since May 19. Andy Lipow, president of Lipow Oil Associates, said Saudi Arabia's cancellation of some crude deliveries to Europe led the market to expect European refineries to turn to buying oil from the United States, which supported WTI crude prices and reflected expectations that Saudi oil exports could be disrupted longer than anticipated. Yanbu port has grown more important to global oil supply after the war between the United States and Israel with Iran affected energy shipments through the Strait of Hormuz, forcing Saudi Arabia to reroute crude shipments westward through the roughly 1,200-kilometre East-West pipeline. However, an attack on that pipeline by the Houthis on Friday, September 11, forced Saudi Arabia to suspend this oil export route. Supply concerns intensified after the Houthis launched a new round of attacks on Saudi Arabia on Monday, September 14, and Arab Gulf countries postponed talks with Iran.