Iranian Strikes on Saudi Energy Infrastructure Deepen Global Oil Supply Crisis

Global energy markets are facing a severe supply shock as Iran targets critical Saudi Arabian oil infrastructure, compounding existing disruptions in the Persian Gulf. Recent strikes on a pumping station along the East-West pipeline have reduced throughput by 700,000 barrels per day (bpd), hindering Riyadh's ability to bypass the volatile Strait of Hormuz. The pipeline, which has a total capacity of 7 million bpd, serves as the primary export route to the Red Sea terminal at Yanbu. With the Strait of Hormuz effectively closed to traffic, the loss of this alternative route leaves Saudi Arabia with limited options for transporting crude to international markets. Beyond the pipeline, attacks on the Manifa and Khurais production facilities have further slashed the kingdom's output by an additional 600,000 bpd. Several refineries have also been targeted, intensifying the operational crisis within the world's largest exporter. The situation is exacerbated by the continued restriction of the Strait of Hormuz, through which approximately 20% of global oil supplies typically flow. Despite a two-week ceasefire agreement brokered by the U.S., industry leaders, including the CEO of Abu Dhabi National Oil Co., report that the waterway remains conditioned and controlled by Iran. According to Kpler analyst Matt Smith, Gulf producers have already shut down roughly 13 million bpd of production due to the Hormuz blockade. The convergence of infrastructure damage and maritime restrictions creates a high-volatility environment for global crude benchmarks.