JPMorgan Reports Strong Oil Flows from Middle East Despite Saudi Pipeline Disruption

JPMorgan analysts have indicated that oil flows from the Middle East are holding up better than anticipated, even in light of the recent disruption to Saudi Arabia's East-West pipeline. In a note dated September 18, the bank reported that total oil flows averaged approximately 17 million barrels per day over the past ten days, which is about 6 million barrels below the 2025 average. This suggests a partial recovery rather than a return to normal levels, as the flows remain significantly lower than last year's figures.

The most significant improvement has been observed in Saudi Arabia, where satellite data revealed that oil moving through the Strait of Hormuz has increased to around 3 million barrels per day over the past six days, a notable rise from approximately 700,000 barrels in August. Overall, Saudi exports averaged about 5 million barrels per day during this period. The pipeline, which connects Saudi Arabia's Eastern Province to the Red Sea port of Yanbu, was disrupted by a drone attack last week, prompting the need for rerouting cargoes through the Strait of Hormuz.

Despite the positive outlook on oil flows, the market remains cautious. Oil prices fell for a third consecutive session, with West Texas Intermediate (WTI) crude closing around $100 per barrel and Brent slightly higher. Analysts from Rapidan Energy Group warned that the risk of a larger disruption persists if the pipeline outage extends beyond September or if tensions escalate involving Iran or Houthi forces. Additionally, reports suggest that China has urged Iran to restrain the Houthis following a Saudi appeal for assistance.

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Source: KLEA News