Oil Prices Stabilise as Saudi Pipeline Restart Offers Supply Relief

PUKMEDIA

Oil prices.

Oil prices stabilised on Thursday following a sharp decline, as signs emerged that Middle East supply disruptions could begin to ease with preparations under way to restart a major pipeline.

Brent crude traded near $106 a barrel after falling 2.7% on Wednesday, while West Texas Intermediate (WTI) crude remained above $102 a barrel.

Saudi Arabia is aiming to restore around half the capacity of the damaged East-West pipeline within days, with the pipeline expected to return to full operations within six weeks, according to a person familiar with the matter.

Haris Khurshid, Chief Investment Officer at Karobar Capital, said the situation remained exposed to risks. While some production and transport capacity was returning to the market, he noted that the safety margin needed to absorb further disruptions had yet to be fully restored.

Oil prices have risen by roughly three-quarters since the beginning of the year, driven by the US-Iran conflict, which has disrupted oil flows from the Middle East, alongside the continuing war between Russia and Ukraine.

The surge in oil and fuel costs has added to global inflationary pressures. Against this backdrop, the Federal Reserve raised interest rates on Wednesday and signalled the possibility of further monetary policy tightening.


PUKMEDIA