Saudi Arabia has shut a critical oil pipeline. Here’s why it matters for the global oil market

Yet another contingency plan for the global oil market – buffeted by more than six months of war between the United States and Iran – has come under serious threat. On Friday, Saudi Arabia announced that it had shuttered its East-West Pipeline, blaming drone attacks from inside Iraq that it said had caused “injuries and some damage.” No group has claimed responsibility, but US President Donald Trump has pointed the finger of suspicion at Iran-backed proxy groups operating inside Iraq. Iran’s foreign ministry “categorically denied” the accusation on Monday. The East-West pipeline – running to the Red Sea port of Yanbu and feeding Saudi coastal refineries – has proved critical in re-routing millions of barrels of Saudi crude from the Persian Gulf during the war.