Brent crude oil prices have surged past the $100 per barrel mark, trading near $106/bbl after Saudi Arabia temporarily closed its East-West pipeline following multiple drone attacks, which injured several people and targeted key stretches in the Riyadh and Medina regions [1][2]. The closure has put more than 4 million barrels per day of crude export capacity at risk, forcing additional volumes toward the vulnerable Strait of Hormuz and raising concerns about further supply disruptions amid ongoing Middle East conflict [2]. Rabobank's Senior Energy Strategists, Joe DeLaura and Florence Schmit, revised their Brent outlook higher, forecasting Brent at $107/bbl in Q4 2026 and $94/bbl in 2027, warning that extended outages to Saudi infrastructure and Red Sea tanker flows could push prices back toward this year’s $126 highs [1]. They also raised forecasts for WTI and refined products, with WTI Q4 2026 at $103/bbl and NY Harbor HO Q4 2026 at $5.02/gal [1].
Analysts cited in both sources emphasize that the market is pricing in a significant loss of regional supply, with global oil inventories already down by around 1 billion barrels, leaving little room to absorb further disruptions [2]. Janiv Shah of Rystad Energy noted that the relatively contained price reaction suggests the market expects Saudi inventories to cushion exports in the near term, but warned that if the disruption extends beyond the five-to-seven-day inventory cushion, prices could rally sharply [2]. Rabobank similarly highlighted that Yanbu inventories may sustain Saudi exports for about a week, but an extended pipeline outage could cause major supply disruption and push Brent even further up to retest the $126 highs for the year [1].
Brent crude futures for November expiry rose 2% to $107.82 per barrel on Tuesday morning, extending gains after jumping more than 21% over the past month [2]. U.S. West Texas Intermediate futures for October expiry traded nearly 2.2% higher at $103.58, up over 25% in the past month and surpassing $100 for the first time since May last week [2]. Rabobank expects Brent to trade in a volatile range between $70-75 as support and $95-$100 as the upper bound, with key movers depending on further disruptions to oil flows through Hormuz or Bab el-Mandab, or attacks on diversionary terminals like Yanbu or Fujairah [1].
The broader Middle East conflict, including renewed hostilities between the U.S. and Iran and a lightning ground offensive by Iran-backed Houthis along the Red Sea coast, is already putting a premium on crude prices [2]. Both sources agree that the loss of Saudi Arabia's East-West pipeline adds another major constraint to the global oil market, with analysts warning that the longer the shutdown, the bigger the price shock [1][2].
CONCLUSION
The closure of Saudi Arabia's East-West pipeline has sharply lifted Brent crude prices above $100, with analysts and strategists warning of further volatility and potential price spikes if the outage persists. Both Rabobank and Rystad Energy highlight that the market is highly sensitive to supply disruptions, and extended outages could push Brent toward this year’s highs. The event has significant implications for global oil supply and consumer prices, with the market impact rated as high.