Oil prices fell sharply in early Thursday trading as Saudi Arabia’s move to offer additional crude shipments through Oman eased some of the market’s fears over worsening Middle East supply disruptions. Brent crude fell $1.24 to $104.59 a barrel in early trading, while U.S. West Texas Intermediate dropped $1.14 to $101.29 after both benchmarks had already fallen roughly $3 on Wednesday, Reuters reports.

Saudi Arabia is offering additional crude to Asian refiners through ship-to-ship transfers off Oman’s Sohar port, creating an alternative route for some exports while the kingdom struggles with damage to its East-West pipeline and disruptions at the Red Sea export hub of Yanbu.

Two pumping stations serving the East-West pipeline were damaged in an attack last week, and assessments cited by Reuters said the timetable for repairs remains unclear. The pipeline has become particularly important because Iran’s blockade of the Strait of Hormuz dramatically disrupted the kingdom’s normal export routes.

Yanbu became Saudi Arabia’s principal alternative outlet after traffic through Hormuz was severely disrupted by the U.S.-Israel war with Iran. Saudi Arabia subsequently suspended crude loading at Yanbu and canceled some deliveries to European customers, helping drive oil prices to roughly four-month highs earlier this week.

The new shipments through Oman have provided the market with at least a partial alternative and reduced immediate fears of a severe Saudi supply shortage. Nevertheless, the broader risk remains elevated as Saudi warplanes strike Houthi targets in Yemen and the Houthis continue missile and drone attacks against the kingdom.

(YWN World Headquarters – NYC)