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Market Chatter: Saudi Aramco Halts September Crude Allocations to European Buyers

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State-controlled energy giant Saudi Aramco has informed at least two European oil refining customers that no crude oil will be allocated to them in September following an attack on a key pipeline connected to the Red Sea, Bloomberg reported Friday, citing people familiar with the matter.

Typically, customers in Europe are supplied Saudi Arabian crude under term contracts. Deliveries under these contracts will not happen next month and this decision will affect all the European buyers, the report said.

The kingdom last week had to shut the East-West pipeline, which bypasses the Strait of Hormuz following drone attacks. The pipeline is expected to partially restart in a few days and be fully restored within six weeks, the report said.

Usually, European refineries receive Saudi crude through Egypt's Sidi Kerir port, which is linked to the Red Sea by pipeline. The shutdown of the East-West pipeline caused panic buying from some of Aramco's customers, the report added.

has reached out to Saudi Aramco separately for comments.

(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)

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