Oil finishes the week flat as the market sees Saudi pipeline outage as less disruptive than feared

Crude oil prices fell for the third consecutive session Friday to finish the week basically flat, as the market anticipates the closure of Saudi Arabia's East-West pipeline will not have as big of an impact on supplies as originally feared.

U.S. West Texas Intermediate futures fell 1.6% to close at $100.30 per barrel. Brent crude, the international benchmark, traded 0.9% lower to settle at $103.87. U.S. crude oil finished the week flat while Brent lost nearly 1%.

Oil prices have gained more than 5% since a drone attack launched from Iraq damaged the Saudi pipeline last Thursday and forced its shutdown.

"Middle East oil flows remain surprisingly strong despite the disruption to Saudi Arabia's East-West pipeline," Natasha Kaneva, head of global commodities strategy at JPMorgan, said in a Friday note.

JPMorgan estimates total oil flows from the Middle East averaged around 17 million barrels per day over the past 10 days, which is about 6 million bpd below the 2025 average.

Satellite imagery suggests the Saudis have moved 2.8 million bpd through Hormuz over the past six days compared to just 700,000 bpd in August, Kaneva said. The kingdom's total exports were 5 million bpd on Tuesday as a 10-day moving average, the analyst said.

But Kaneva cautioned clients that these volumes might be hard to sustain. "For now, the workaround appears to be working—so long as Iran allows it to," the analyst said.

Indeed, the threats to crude oil and product supplies are significant, said Helima Croft, head of global commodity strategy at RBC Capital Markets.

Iran's Houthi allies in Yemen "likely retain the drone and weapons supplies required for further attacks on the East-West Pipeline and energy infrastructure along the Red Sea," Croft said in a Thursday note.

Rapidan Energy, meanwhile, estimates the pipeline outage will constrain Saudi crude production and exports through at least the end of September.

"Risk remains skewed toward a larger disruption if the pipeline outage extends past September or Iran, the Houthis, or other proxy groups escalate attacks," Rapidan said in a Thursday note.