Oil prices recovered from session lows on Friday as the market assessed the impact of attacks on Saudi Arabia's East-West Pipeline and continued disruption of shipping through the Strait of Hormuz.
Brent crude futures fell 33 cents, or 0.31%, to $104.49 a barrel by 1411 GMT after touching a session low of $101.92. US West Texas Intermediate gained 88 cents, or 0.86%, to $102.79 after dipping to $99.39. Prices had climbed close to four-month highs earlier in the week.
Three pumping stations serving Saudi Arabia's vital East-West Pipeline were damaged in an attack last week, one more than previously assessed, according to satellite imagery reviewed by three industry sources. The repair timeline remains unclear. Crude loadings at Saudi Arabia's Yanbu export hub on the Red Sea were suspended following the attacks, and Riyadh cancelled some deliveries to Europe.
Saudi Aramco informed at least two European refining customers that they would receive no crude oil next month, Bloomberg News reported on Friday.
Prices cooled somewhat amid reports that Saudi Arabia was seeking to restore approximately half of the East-West pipeline's capacity within days, though Reuters sources offered varying estimates for the restoration timeline.
Separately, traffic through the Strait of Hormuz fell sharply. Four commodities vessels passed through the strait in the Gulf on Thursday, below the 10-day average of about 16 vessels, according to preliminary shipping data. Three liquefied natural gas vessels also reappeared outside the strait on Thursday, per Kpler data.
"Oil prices are being supported by ongoing tensions in the Middle East, with tankers being targeted in the Strait," said Giovanni Staunovo, UBS energy analyst.
Priyanka Sachdeva, head of market insights at Phillip Nova, said the key question is whether physical flows can normalize and on what timeline. "If we see a sustained improvement in Hormuz traffic, some of the geopolitical premium can unwind further," she said.
In other market data, refined product stocks grew by 3.7 million barrels last week, driven by builds in the West and Singapore, Morgan Stanley noted. China's refined oil exports rose 12.7% year-on-year in August, with jet fuel exports hitting a record high, according to customs data released Friday.
Saudi Arabia and Yemen's Iran-backed Houthis exchanged fresh strikes across their border on Thursday. An Iranian delegation will be able to attend the United Nations General Assembly discussion on the conflict next week, the US State Department said. An interim agreement between the US and Iran collapsed in June, and no peace talks have been held since.
