Global Oil Price Drops Below $100 a Barrel

The global price of oil dropped on Tuesday on reports that Saudi Arabia was close to restarting a critical pipeline damaged in attacks by Iranian-backed Houthi militia over a week ago.The price of Brent crude, the global benchmark, fell over 2 percent to about $98 a barrel, down sharply from nearly $109 a week ago.Saudi Arabia has pushed to get more oil ready to exit the Strait of Hormuz, as its East-West pipeline has been shut since Sept.11, when the Saudis said it was struck by Houthi militia.

Bloomberg reported that the Saudis were testing the pipeline to possibly restart it this week.Saudia Aramco, the state oil giant, did not respond to a request for comment.Over the past week, Saudi Arabia increased the volume of oil that it has loaded onto vessels in the Persian Gulf to an average of 4.3 million barrels per day, about two-thirds the volume it exported before the start of the Iran war, according to data from Kpler, a maritime tracking company.

Saudi loadings from the Gulf were 1.6 million barrels a day on average for the first seven days of September, before the East-West pipeline was attacked.The increase in crude loadings is substantial, said Matt Smith, an analyst at Kpler.He said it signaled either that Saudi Aramco officials were concerned that the East-West pipeline would be down for longer so they needed to reroute barrels through the Strait of Hormuz.

Or it signaled increased confidence in being able to use the strait.The Abu Dhabi National Oil Company, the national energy company of the United Arab Emirates, has continued to use the waterway for its exports, despite the risks.“They’re potentially jumping on that trend,” Mr.

Smith said of Saudi Aramco.The East-West pipeline, a 750-mile network that transports crude across Saudi Arabia, from oil fields near the Persian Gulf coast to ports on the Red Sea, had become the kingdom’s primary way of exporting oil since the war in Iran began.Iranian attacks in the Strait of Hormuz had limited Saud...