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Saudi Arabia targets ten million barrels in pipeline capacity

Saudi Arabia is examining ways to raise oil pipeline capacity to destinations outside the Gulf to 10 million barrels a day within two to three years, Energy Minister Prince Abdulaziz bin Salman said, as the kingdom seeks more routes for crude exports.

The proposal would significantly increase the volume of oil that could move without passing through the Strait of Hormuz, a crucial shipping passage disrupted by the war involving Iran. The minister's target remains an ambition under examination rather than an approved construction programme.

Saudi Arabia's principal alternative is the East-West Pipeline, which carries crude from eastern producing areas to Yanbu on the Red Sea. The system has a stated maximum capacity of seven million barrels a day, although volumes transported depend on operating conditions, refinery demand and export arrangements.

Prince Abdulaziz said on 6 October that the pipeline had recovered to a throughput of 5.8 million barrels a day following damage and a temporary shutdown in September. His disclosure highlighted both the importance of the route and the vulnerability of infrastructure intended to protect exports from maritime disruption.

The planned increase would involve creating additional capacity equivalent to three million barrels a day compared with the East-West system's existing maximum. The minister did not provide a detailed breakdown of potential projects, their costs or the proportion that might be delivered through upgrades rather than new pipelines.

The distinction matters because the ability to pump crude across Saudi territory does not automatically translate into matching export volumes. Red Sea terminals need sufficient storage, loading facilities and tanker access, while domestic refineries also draw on supplies transported westwards.

Aramco chief executive Amin Nasser said in May that roughly two million barrels a day of the East-West system's capacity served refineries on the western coast, leaving about five million barrels available for exports. Those figures describe how the existing capacity is allocated, rather than a guaranteed daily level of shipments.

Saudi officials have been examining pipeline options as fighting has impeded commercial shipping through Hormuz. The narrow waterway normally connects Gulf producers with international markets, making its security central to oil deliveries and shipping costs.

Expansion discussions preceded the latest announcement. Saudi Arabia was considering adding as much as two million barrels a day to its Red Sea pipeline network in July, with preliminary contacts involving neighbouring producers, including Kuwait. No final investment decision or binding cross-border arrangement was publicly established at that stage.

A capacity target of 10 million barrels a day therefore marks a broader objective than the additional volume previously discussed. It does not necessarily mean the kingdom plans to export that amount each day, or that all the capacity would be available immediately after construction.

The September attack on pipeline facilities showed that bypassing a maritime chokepoint introduces different security demands. Saudi authorities suspended operations as a precaution while teams assessed the damage and safety of the network. Crude loading at Yanbu was interrupted before shipments resumed following repairs and the restart of pipeline movements.

The restored flows announced in Manama in early October were an important step after the shutdown. However, the existence of a seven-million-barrel technical ceiling does not mean the system is consistently operating at that rate, especially when shipping or terminal conditions constrain deliveries.

Oil companies across the region are reviewing alternative export routes as threats extend beyond Hormuz to the Red Sea approaches. Any investment decisions must weigh the cost of additional transport infrastructure against the duration of security risks and the commercial value of maintaining spare capacity.

The expansion proposal comes while Saudi Arabia is hosting the World Petroleum Congress in Riyadh. Prince Abdulaziz addressed the gathering despite attacks on the capital that disrupted air travel and prompted changes to the attendance of several major international oil and energy executives.

For Aramco, which operates the kingdom's oil infrastructure, a larger network would require coordination between production facilities, pumping stations, domestic processing and coastal export installations. Saudi authorities have yet to identify contractors, financing arrangements or a timetable for individual engineering works associated with the stated goal.

The East-West Pipeline extends approximately 1,200 kilometres from the kingdom's eastern oil-producing region to Yanbu. Its role is to move crude across the peninsula, allowing cargoes to be loaded on the Red Sea coast rather than at terminals inside the Gulf.
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