Global Oil Crisis Imminent: New Evidence Emerges
Global oil prices surged during trading on Tuesday (15/09/2026) following disruptions to Saudi Arabian exports and the cancellation of several crude oil shipments to Europe. The price increase was also driven by growing concerns regarding global supply after a series of attacks targeted energy infrastructure in several oil-producing nations.
According to Reuters on Wednesday (16/09/2026), Brent crude closed up US$3.07 or 2.9% to US$108.75 per barrel. Meanwhile, US West Texas Intermediate (WTI) crude jumped US$4.44 or 4.38% to US$105.83 per barrel. Both oil contracts recorded their highest closing levels since 19 May.
The larger increase in WTI compared to Brent occurred after shipping industry sources stated that crude oil loading at the Yanbu terminal in Saudi Arabia had been halted. Riyadh has also reportedly cancelled several crude oil cargoes for European customers scheduled for delivery in late September.
These disruptions are a major market concern as Yanbu is a critical route for Saudi Arabian oil exports, particularly after the US-Israel conflict with Iran disrupted shipping through the Strait of Hormuz. The Strait of Hormuz is a strategic pathway for global energy trade. Disruptions in the region have forced Saudi Arabia to rely more heavily on the East-West Pipeline, a approximately 1,200-kilometre pipeline that transports oil from the eastern part of the country to Yanbu on the Red Sea coast.
However, Saudi export routes are now facing additional pressure following attacks by the Iran-aligned Houthi group on Saudi oil infrastructure on Friday. These disruptions have heightened market fears regarding how long Saudi Arabian exports can remain normalised.
“Traders have been buying WTI futures on the assumption that the disruption to Saudi Arabian exports will last longer than expected,” said Andy Lipow, President of Lipow Oil Associates. He noted that such conditions could prompt European refineries to switch to crude oil from the United States.
Hamad Hussain, a senior economist for climate and commodities at Capital Economics, stated that the new Houthi attacks on Saudi Arabia could also affect investor expectations regarding the severity and duration of the conflict. “The new attacks by the Houthi group targeting Saudi Arabia may affect oil market investors’ expectations regarding the severity and duration of the conflict,” he said.
Global oil supply pressure is also coming from Libya. The National Oil Corporation (NOC) stated that operations at three oil fields have been halted after members of the Petroleum Facilities Guard closed valves on the Hamada-Zawiya export pipeline. The NOC warned it may declare force majeure if the shutdown continues, a condition that could potentially disrupt production from other oil fields.
Meanwhile, the situation in Saudi Arabia remains a concern as disruptions to the East-West Pipeline could limit Riyadh’s ability to flow oil to export terminals on the Red Sea. Goldman Sachs estimates that the repair time for the pipeline could range from a few days to eight weeks. Conversely, US Energy Secretary Chris Wright stated that oil flow through the vital pipeline should be restored within a few days. These differing estimates have left the market facing uncertainty regarding the duration of the Saudi supply disruption.
At the same time, attacks by Russia and Ukraine on each other’s energy facilities have added further pressure to fuel supplies. This series of disruptions leaves the oil market facing increasing supply risks, especially as conflicts in the Middle East continue to threaten major energy trade routes.