00:00Stuart, that pipeline in Saudi Arabia that we've talked about multiple times as their strategy to bypass Hormuz,
00:07that's now been shut as a precautionary measure. What is the impact of that?
00:12I mean, in theory, it's 7 million barrels a day, which in this market is enormous.
00:17Now, quite whether it's going to be that is a different matter.
00:20We presume they have a certain amount in stockpile sitting at Yambu, that is that sort of port on the
00:25Red Sea,
00:25so that can keep them going. The second thing is we don't know exactly what's been damaged and how long
00:30it's going to take to repair.
00:32So really, it depends on what the time frame is.
00:34If we're talking about a few days where they can get at least some of the capacity back up on
00:37there, maybe it's not so bad.
00:39If it's weeks and weeks and weeks and it really is completely shut for that period, then it becomes much
00:44more drastic.
00:45And you do wonder in that scenario, we had comments, for instance, from the US over the weekend that maybe
00:50the market was tight,
00:51but not that tight because quite a lot of barrels were getting out.
00:53Now, they're going to have to rethink that stance entirely if East-West stays down for a prolonged period of
00:58time.
00:59Yeah, and it's just about what is a prolonged period of time in the midst of this wider war.
01:03Now, let's talk about Saudi's second options here, because we've already seen their exports at about 3 million barrels a
01:09day in August.
01:09That is the lowest since 2017.
01:12What secondary options could they resort to in the midst of this secondary option already being shut down?
01:19It's an extremely good question.
01:20I mean, I was sitting here this morning thinking about that, what exactly are the options here?
01:24I mean, I suppose in theory you can get a certain amount onto, you know, tanker trucks, that is, and
01:29shipments.
01:29I mean, that's not realistic.
01:31I mean, we're talking about tiny volumes.
01:32You can't fill up a super tanker where you could eventually, but it's going to take you weeks to do
01:37it.
01:37So, realistically, there aren't a lot of good options here.
01:40You know, the East-West pipeline was plan B.
01:43It was operating very, very successfully, you know, relative to what it was supposed to be doing.
01:48Now that is down, at least temporarily, hard to see what else they have.
01:52There are some barrels getting out through Hormuz, but again, nothing like the volume that you would normally see.
01:56Yeah, quite dire.
01:58And this is, of course, all happening in the midst of overnight the news about that meeting between GCC nations
02:03and Iran taking place in Oman, getting postponed.
02:07We've heard from the Omani foreign minister as well.
02:09Do we know any reasons behind the postponement?
02:13We've had no official reasons, but I think we can take an educated guess that whatever was on that bit
02:18of paper was not particularly palatable to at least some of the more powerful countries on this side of the
02:24Persian Gulf.
02:26Again, it comes down to time frame.
02:28How much longer is this going to be postponed?
02:30Because if you recall, it's been weeks that they've been saying we're on the cusp of a deal.
02:35Nothing's materialized.
02:36We seem to be back.
02:37I mean, you can't say we're back to square one, but we're definitely in a precarious position again.
02:40And there's no obvious exit for either side on this.
02:43Yeah, of course.
02:44And they mentioned that consensus.
02:45Bahrain also saying ahead of time that it wasn't going to join that meeting.
02:49So a lot of moving parts set against.
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