The Kingdom’s crude oil production increased to 8.135 million bpd from June’s ratio of 7.122 million bpd. However, the JODI website, which displays monthly export data for OPEC member countries, stated that Saudi’s refinery crude throughput declined by 0.020 million bpd to 2.478 million bpd in July from 2.498 million bpd the previous month.

Direct crude-burning, on the other side, decreased by 22,403 bpd to 561,097 bpd.

While UBS analyst Giovanni Staunovo linked the increase in Saudi ⁠crude and product exports with slowing down of the regional conflict, he added that exports could be weaker in August, particularly from Red Sea terminals, due to the renewed tensions involving the Iran-backed Houthi rebels.

Meanwhile, Saudi Arabia ‌has restarted operations at its East-West Pipeline and could resume exports from the Red Sea port of Yanbu, as per the reports.

Drone attacks, which Saudi Arabia has blamed on Iraqi ⁠militia, forced the Kingdom to shut the pipeline on September 11, halting crude loadings at the Yanbu Port.

As the Iran war began in February, Tehran, in retaliation to the US-Israeli joint airstrikes on its territories, put an embargo on the energy trade activities through the strategically crucial maritime chokehold called the Strait of Hormuz.

Riyadh, to bypass the roadblock, has been using the East-West Pipeline to reroute around four million barrels per day—around 4% of global supply—to Yanbu.

While the pipeline is pumping at a low rate after its restart, state-run oil giant Saudi Aramco is reportedly seeking to get the pumping rate back to four million bpd. The pipeline has a capacity of seven million bpd.

Reaching a rate of 40% of capacity will take ‌a ⁠couple of days, and a full restart will take six to eight weeks, a security source told Reuters.

Another oil industry source said a return to full pumping rates would take up to six weeks.

Three of the 11 pumping stations serving the East-West Pipeline got damaged in the drone attack, according to satellite imagery and industry sources.

The pipeline will resume crude supply to Aramco refineries located on the Red Sea coast, with one cargo already scheduled to load at Yanbu. As per some sources, the consignment will be dispatched for China.

Traders were also getting ⁠ready for Saudi oil loadings by moving tankers to Egypt’s Mediterranean Port Said for ship-to-ship transfers and also to Sidi Kerir.

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State-owned oil giant Saudi Aramco has reportedly offered its flagship Arab Light grade, as well as Arab Medium and Arab Heavy, to term buyers in Asia for loading off Sohar, which is outside the Strait of Hormuz.

“The offers indicate that Aramco is moving more crude out of the Gulf for onward transfer outside the waterway. Recently, Aramco has made ⁠at least two similar offers of Arab Medium and Arab Heavy to Asian buyers,” reported Reuters.

Over the past week, the Kingdom has doubled daily crude loadings at its Ras Tanura and Juaymah terminals inside the Gulf to about two very large crude carriers, equivalent to four million barrels, according to satellite tracking by consultancy Energy Aspects.

Separate ship tracking data from Kpler showed four VLCCs capable of carrying a combined eight million barrels loading at Ras Tanura on September 16.

While Aramco has increased its loadings and supply volume-related activities, other Gulf producers are also offering more crude for loading outside the Strait of Hormuz ‌after ⁠securing vessels to shuttle supplies through the waterway, with switching off the vessel tracking devices emerging as the most preferred method.

Saudi Arabia, known as the world’s biggest oil exporter, has relied on its East-West pipeline to divert crude to the Red Sea port of Yanbu for export to avoid shipping its energy consignments through the Strait of Hormuz.

However, last week, drone attacks damaged the pipeline, forcing the Kingdom to shut it down, sending global oil benchmarks to multi-month highs.

Saudi has also informed its European customers ⁠that some September-loading crude cargoes will be cancelled, with loadings at Yanbu remaining suspended.

Top customers like Poland have reportedly rushed to seek alternatives, with cargo prices breaching the USD 100 mark again, after a brief lull.

The cut in Saudi flows through the Red Sea may end up prompting Riyadh to try to export more oil via the Strait of Hormuz using so-called dark shipments similar to those already used by the UAE and Iraq.

Such shipments have allowed Gulf oil producers to export seven million to nine million barrels per day, which is 30% to 40% of pre-war volumes.

Saudi Arabia, in the week of September 7 to 13, loaded 22 million barrels of oil across 12 vessels at Ras Tanura/Juaymah, as opposed to six to seven vessels per week for the prior three weeks, data from Vortexa showed.

As per the sources, Polish integrated oil firm Orlen PKN.WA was rushing to find crude oil cargoes from the North Sea and further afield to replace disrupted Saudi imports.

Aramco emerged as Orlen’s top oil supplier in 2022 and now supplies around 40% of its oil, helping to diversify from risky Russian energy intake.

Orlen has reportedly purchased several cargoes of crude oil in spot tenders, apart from picking up North Sea grades including Grane, Johan Sverdrup, and Johan Castberg.

The oil venture has also tendered for grades further afield, including US WTI ⁠Midland and Kazakh CPC Blend. Another tender has been issued this week to buy North Sea or Algerian crude for October delivery and Guyanese crude for November delivery.

The Baltic port of Gdansk in ⁠Poland received around 160,000 bpd of Saudi crude this year to date, and Lithuania’s Butinge received 63,000 bpd, data from analytics firm Kpler showed.

“Feedstock deliveries to Orlen refineries are proceeding without disruption,” the company spokesperson said.

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Saudi Arabia has temporarily shut its East-West pipeline following drone attacks on the vital crude conduit, which has become a critical alternative export route amid the war-related disruption in the Strait of Hormuz. The closure threatens to deepen the global oil supply squeeze and push prices higher if repairs take longer than expected.

The 1,200-kilometer pipeline, also known as Petroline, transports crude from Saudi Arabia’s oilfields in the east to the Red Sea port of Yanbu. It has been moving between 4 million and 5 million barrels per day recently, equivalent to roughly 4-5% of global oil supply, according to ship-tracking companies and analysts cited by Reuters.

Alternative route under threat
The pipeline’s importance has grown sharply since tanker traffic through the Strait of Hormuz slowed to a trickle amid the conflict between the US and Iran. By moving crude across the Arabian Peninsula to Yanbu, Saudi Arabia has been able to bypass the congested Gulf shipping route and maintain access to markets west of the Kingdom.

The latest attack threatens that workaround. Saudi Arabia’s Energy Ministry said the pipeline had been stopped as a precaution after the strikes, which caused injuries and material damage. Satellite imagery showed smoke rising from an area along the pipeline south of Medina.

The attacks took place in Saudi Arabia’s Riyadh and Medina regions. Riyadh and Baghdad said the drones originated in Iraq, where Iran-backed militias operate. No group had immediately claimed responsibility, while Iraq launched an investigation and dismissed a military commander linked to operations in Maysan province, near the Iranian border.

Saudi Arabia has so far held back from retaliation at Baghdad’s request, giving the Iraqi government time to investigate and prevent further attacks from its territory. The episode nevertheless highlights the growing vulnerability of the kingdom’s energy infrastructure as the regional conflict widens.

Stocks offer only limited relief.
The immediate concern for oil traders is not simply the volume of crude that the pipeline can carry, but how long Saudi Arabia can sustain exports while the alternative route remains unavailable.

According to Reuters, existing stocks at Yanbu could be depleted within five to seven days if the pipeline remains offline. Egypt’s Ain Sukhna and Sidi Kerir ports provide some relief with additional supplies, but the available volumes remain limited.

The narrow stock cushion means the duration of the outage will be critical. Inventories and alternative logistics can absorb a brief interruption.

A prolonged shutdown, however, would increase the risk of actual supply losses, potentially tightening the market further at a time when buyers are already competing for fewer available barrels.

Saudi oil production has also been under pressure. Reuters reported that output had fallen from 10.9 million barrels per day in February to 6.2 million bpd in August, its lowest level in more than three decades. The International Energy Agency has forecast a global oil supply decline of 5.7 million bpd, or 6%, this year.

The Red Sea adds to energy risk
The pipeline shutdown comes as Iran-aligned Houthi forces in Yemen tighten their grip on Red Sea shipping.

The Houthis have seized Perim, also known as Mayun Island, at the mouth of the Bab el-Mandeb Strait, according to Yemeni government sources cited by Reuters. The strategic waterway connects the Red Sea with the Gulf of Aden and is an important route for oil tankers travelling between the Middle East and Europe.

The development creates a double challenge for Saudi Arabia. Its East-West pipeline had offered a way around Hormuz, but the Red Sea route itself is now becoming more dangerous. MarketWatch reported that oil shipments through Bab el-Mandeb had ceased, while Saudi Arabia was attempting to reroute exports through Egypt’s Sidi Kerir port, a more costly and time-consuming option.

The combination of a blocked or severely disrupted Hormuz route, a threatened Red Sea corridor, and damage to Saudi Arabia’s principal east-west crude pipeline leaves fewer reliable options for moving oil to international customers.

Prices and inflation in focus
Oil markets have already reacted to the worsening supply outlook. Brent crude has risen above $100 a barrel, while diesel prices in the US have reached record levels, according to Reuters and the Financial Times. The disruption is also raising concerns over inflation, particularly as higher transport and energy costs feed into consumer prices.

For the GCC, the crisis presents a difficult balance between protecting critical energy infrastructure and preventing further escalation. Saudi Arabia has asked Washington for military assistance against the Houthis, while the United States faces pressure over the economic impact of rising fuel prices.

The pipeline outage is therefore more than a temporary operational setback. It is a test of Saudi Arabia’s ability to maintain crude exports under sustained geopolitical pressure and a warning to global oil markets that the loss of a single alternative route can have consequences far beyond the Arabian Peninsula.

For traders, refiners, and governments, the next few days will hinge on the speed of repairs, the availability of alternative export routes, and whether attacks on regional energy infrastructure continue. Until those questions are answered, the threat of a supply shock remains firmly in focus.

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Saudi energy giant Aramco witnessed a 44% increase in its Q2 2026 profits, as it faced windfall from higher crude oil prices, ‌refined products and chemicals while forced to reroute shipments to avoid the war-hit Strait of Hormuz.

The world’s top oil exporter posted net profit of USD 32.69 billion in the three months ended June 30, compared with USD 22.67 billion a year earlier.

Aramco said it maintained a supply reliability rate of 98.4% during the quarter despite continued geopolitical uncertainty in ‌the ⁠wider Gulf region.

The energy major’s adjusted net income during the quarter stood at USD 33.4 billion. For the H1 (first half) of 2026, the total number was USD 67.2 billion.

Cash flow from operating activities stood at USD 25.4 billion and USD 56.2 billion for Q2 and H1, respectively. Free cash flow, on the other hand, was at USD 12.3 billion and USD 30.9 billion at the same timeframes.

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That assumption has been tested more severely in 2026 than at any point in recent memory, and the Gulf’s response is now visible in trucks, pipelines and ports rather than just in policy papers.

In the second week of July, Dubai-based DP World added 700 lorries to its regional fleet, a move that will support up to 35,000 additional trips a month across the GCC.

The company said the fleet would serve first, middle and last-mile logistics, covering both containerised and non-containerised cargo, and that it forms part of a wider effort to build bonded, customs-controlled road corridors linking east coast gateways directly to Jebel Ali Port.

DP World’s logistics chief for the GCC, Raveen Guliani, framed it as a response to what customers now demand. He claims they need certainty and reliability in a region where the sea route can no longer be taken for granted.

That single announcement is a small piece of a much larger shift. Since fighting between the United States and Iran erupted in February and repeatedly flared since, Gulf states and the companies operating within them have moved from treating Hormuz contingency planning as an occasional exercise to treating it as core infrastructure strategy.

The question now being asked in boardrooms from Riyadh to Abu Dhabi is not whether to reduce dependence on the strait, but how far that dependence can realistically be cut, and how quickly.

A war that keeps reopening the wound
The scale of the disruption explains the urgency. Iran’s closure of Hormuz to non-Iranian vessels forced Gulf producers to shut in as much as 12 million barrels per day of oil at the peak of the crisis. Iraqi output collapsed from around 4.3 million barrels a day to under 1.5 million in May.

Kuwait declared force majeure. Bahrain’s Sitra refinery was struck repeatedly. A ceasefire framework reached in June briefly restored some shipping, but it has proved fragile.

Strikes and counter-strikes resumed in July, tankers were hit inside the strait, and daily transits have fallen from around 135 ships before the war to fewer than 40 in recent weeks, according to shipping data cited in regional reporting.

Washington has since said it will reimpose a naval blockade of Iranian ports and floated the idea of tolls (20% transit fee) for “safe passage” of ships through the strait, a proposal Tehran has publicly haggled over rather than rejected outright.

As per the latest updates, the Donald Trump administration has dropped the idea, pursuing instead trade and investment agreements with Gulf states.

Every time the waterway closes or comes under threat, the economic cost lands immediately on Gulf exporters and on global energy and shipping prices. That repeated shock, rather than any single event, is what has pushed the region towards what might be called a “Hormuz Plus One” strategy.

The idea is to keep using the strait when it is open, but build enough parallel capacity on land and along the Red Sea and Gulf of Oman coasts that a closure no longer means an economic stop.

Saudi Arabia’s pipeline bet
Saudi Arabia’s answer predates the current war by more than four decades. The East-West Pipeline, also known as Petroline, was built in the 1980s during the Iran-Iraq war specifically to move crude from the Kingdom’s eastern fields to the Red Sea port of Yanbu without touching Hormuz.

It has proved its worth this year with Aramco pushing the line to its full capacity of seven million barrels a day within days of the first strikes, and Yanbu exports reaching around five million barrels a day since.

That capacity, however, only partly offsets what Hormuz can carry. Roughly 15 million barrels a day of crude used to move through the strait before the war, meaning even a maxed-out Petroline covers well under half of that flow.

This is why Riyadh is reportedly in preliminary talks to expand the pipeline’s capacity by a further one to two million barrels a day, according to sources cited by Reuters, potentially with a smaller secondary line dedicated to refined products.

The project would take years and cost billions, and would require changes to how Saudi crude is priced for international buyers.

Crucially, the Kingdom is also discussing whether the expanded system could carry crude on behalf of neighbours who have no pipeline options of their own, Kuwait, Bahrain and Qatar among them. Kuwait’s state oil company has confirmed talks are under way with both Saudi Arabia and the UAE to find space for its barrels.

The UAE goes further, and faster
If Saudi Arabia’s approach is decades-old infrastructure being stretched, the UAE’s is a newer and broader build-out. Abu Dhabi’s existing Habshan-Fujairah pipeline already carries up to 1.8 million barrels a day of crude to the Gulf of Oman coast, bypassing Hormuz entirely. ADNOC is fast-tracking a second pipeline along the same route, reportedly around half complete, aimed at doubling that capacity by 2027.

What is more striking is that the UAE strategy has moved well beyond oil. With container traffic at Jebel Ali, Dubai’s flagship port and one of the world’s largest, having fallen by as much as 95% at the height of the Strait’s closure, DP World is now in talks to build an entirely new multipurpose port and container terminal at Fujairah, on the Gulf of Oman coast, according to reporting by the Financial Times. Cargo landed there would move onward to Dubai, Abu Dhabi and other commercial centres by road, dovetailing directly with the kind of trucking capacity DP World has just expanded.

Parallel expansion is under way at Khor Fakkan, where Sharjah-based Gulftainer has committed roughly two billion dollars to grow capacity, and at Dibba, with UAE officials scoping out at least one further harbour along the same coastline.

The government’s own language leaves little ambiguity about intent. UAE Minister of Foreign Trade Thani Al Zeyoudi has said the country is aiming for “Zero Hormuz Dependency,” regardless of whether the Strait remains open. New rail links, roads and pipelines are being built to connect these eastern ports and fields to the country’s population and industrial centres, an implicit acknowledgement that ports alone cannot absorb the shift without inland logistics to match.

Where the strategy runs into limits
Even so, “Hormuz Plus One” is not the same as “Hormuz Optional.” Analysts note that the conflict has focused regional minds on the risks of relying on a single chokepoint, but the physics of oil and gas infrastructure impose hard limits on how far that reliance can fall. Kuwait, Bahrain and Qatar have no pipelines of their own and depend entirely on Saudi or Emirati goodwill and spare capacity.

Iraq’s northern pipeline to Turkey remains dogged by disputes and runs well below its potential.

Qatar’s economy rests overwhelmingly on liquefied natural gas (LNG), which cannot simply be piped overland in the way crude can; Doha is examining several alternatives, including routing through Saudi territory, but none offers anything close to a full substitute for seaborne LNG carriers transiting Hormuz.

Containerised trade faces its own version of this problem. Trucking and rail can absorb meaningful volumes, DP World’s overland corridors have already moved more than 350,000 twenty-foot equivalent units since the disruption began, but that is a fraction of the more than 15 million containers Jebel Ali alone handles in a normal year.

Road networks, customs posts and warehousing in Fujairah, Khor Fakkan and Dibba are already under visible strain from the diversion so far, with weekly container movements through Khor Fakkan rising roughly eightfold and daily truck traffic climbing from around 100 vehicles to close to 8,500.

A structural shift, not a full escape
What is emerging, then, is not an exit from Hormuz but a hedge against it. Saudi Arabia’s pipeline expansion and the UAE’s port and pipeline build-out will, over the next two to three years, meaningfully raise the volume of oil that can move without touching the strait, and DP World’s road and rail investments will do the same for containerised goods.

Together, these efforts could shave a serious portion off the economic damage of any future closure, particularly for crude oil, where physical bypass infrastructure already exists and is being expanded.

But total independence from Hormuz remains out of reach for the foreseeable future, especially for gas, for smaller Gulf states without their own pipelines, and for the sheer volume of containerised trade that still needs a deep-water port inside the strait to function efficiently.

The Gulf is not abandoning Hormuz. It is building a costly, overlapping insurance policy around it, one truck, pipeline and port terminal at a time, in the hope that the next time tensions flare near Bandar Abbas, the region’s economies will not have to hold their breath quite so completely.

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