Saudi Aramco has informed European oil buyers that they will receive no crude oil deliveries next month under long-term agreements following attacks on the kingdom's East-West Pipeline. According to Bloomberg News, citing people familiar with the matter, the company told at least two European refining customers that term contract deliveries will not proceed as scheduled. This decision affects all European buyers who normally receive steady monthly crude flows from Saudi Arabia, creating immediate supply chain disruptions for the continent's refineries. The scale of the disruption is particularly significant as European OECD countries had been importing 577,000 barrels per day from Saudi Arabia as of June, according to the International Energy Agency, with those volumes now facing a complete halt for October. Saudi Arabia is Europe's fifth-largest oil supplier, having provided almost 30 million tons of oil to the continent in 2025.
The supply disruption has triggered unprecedented market responses, with North Sea oil premiums soaring to record levels as European refiners scramble for alternatives. According to Bloomberg News, Norway's Johan Sverdrup crude was offered at a premium of as much as $35 a barrel above the Dated Brent physical benchmark, compared to just 60 cents premium less than two weeks earlier. The surge reflects how desperate European refiners are to secure supplies amid a fuel crunch that has pushed diesel prices above $200 a barrel. The Dated Brent benchmark climbed above $130 a barrel for the first time since April, while soaring freight costs mean most refiners prefer cargoes that don't require long voyages. Even grades like Johan Castberg and CPC Blend, which aren't direct Middle Eastern substitutes, are rallying with premiums of more than $30 and $9 above Dated Brent respectively.
The supply disruption comes as Saudi Arabia faces unprecedented production challenges amid escalating regional attacks. According to Bloomberg News, Saudi Arabia had told OPEC that its crude production fell by 1.9 million barrels a day last month to 6.238 million barrels a day, putting output at its lowest level since 1990 and below its previous wartime low. This dramatic decline represents a significant escalation from the initial pipeline disruption, with the kingdom now facing both supply and production constraints. The production crisis has prompted Saudi Arabia to seek alternative routes for its crude exports, including increased shipments through the Persian Gulf route and strategic ship-to-ship transfers off Oman's Sohar port.
To maintain crude supply operations, Saudi Aramco has implemented a significant logistical strategy utilizing alternative shipping routes. According to Reuters, the company sold approximately 60 million barrels of crude oil for loading in September and October 2026, utilizing ship-to-ship transfers off Oman's Sohar port and direct loadings from its Persian Gulf terminal at Ras Tanura. This strategic approach allows the company to bypass supply disruptions caused by the pipeline attacks, with shipments now going through the Persian Gulf route that Aramco had largely avoided during previous Middle East conflicts due to security concerns. Even as European supply dries up, Saudi Arabia has ramped up exports from its Gulf port of Ras Tanura, with Gulf exports reaching an average of 1 million to 1.5 million barrels per day, similar to or slightly higher than August levels. Chinese and South Korean refiners are among the top buyers of the spot supplies, with some volumes also going to India and Japan, according to trade sources.
The supply disruption is forcing European oil companies to actively seek alternative sources for their crude requirements. Poland's Orlen SA, the biggest oil company in the European Union's east, is particularly affected as it gets about half of its crude requirements from Saudi Aramco. According to Bloomberg News, Orlen CEO Ireneusz Fafara said the company has been active in the spot cargo market to replace deliveries halted by the drone strike on the Saudi pipeline. "We have excellent relations with Aramco and we are very satisfied with them. They are a very credible partner," Fafara said, while noting that the search for potential new sources of supply was a result of the geopolitical situation. Orlen had previously increased supplies from Saudi Arabia as it sought to reduce its historic reliance on Russia and strengthened cooperation with Aramco earlier this decade by selling the Saudi company a stake in a refinery in the Baltic port of Gdansk. The company has issued more than 10 tenders since September 11 as it seeks alternative supplies, with CEO Fafara aware of four September shipments that wouldn't arrive.
