Saudi Arabia Restarts East-West Pipeline and Iran Offers to Reopen Hormuz Within Seven Days, Sending Oil Prices to Two-Week Low

Oil prices fell sharply on Tuesday, reaching their lowest level in two weeks, after Saudi Arabia began restarting its East-West pipeline and Iran signaled it could reopen the Strait of Hormuz within seven days as part of a diplomatic push to ease the U.S.-Iran conflict. Brent crude briefly slipped below $98 per barrel and at times traded under $100, while WTI fell below $93 per barrel, with Brent down roughly 2.8% and WTI off about 2.9% on the day, extending a slide that has now lasted five consecutive sessions and erased more than 9% from prices over the prior four days.

The East-West pipeline, which runs across Saudi Arabia to the Red Sea and can carry up to 7 million barrels per day, was shut after sustaining damage in a drone attack launched from Iraq on September 10. Its closure had forced Saudi Arabia to reroute crude exports through the Strait of Hormuz, the very chokepoint at the center of the U.S.-Iran conflict, pushing oil prices up more than 16% during the month before Tuesday's reversal. Repairs had initially been estimated to take three to five weeks, making the speed of the restart a significant surprise for markets.

On the diplomatic front, Iran's reported offer to reopen the Strait of Hormuz compounded the bearish pressure on prices. Oil had already begun sliding overnight on the Hormuz news before the pipeline reports added further momentum. Separately, U.S. Treasury Secretary Scott Bessent announced that all Iranian airlines would be shut down effective Wednesday, tightening economic pressure even as diplomatic signals improved. U.S. equity futures held mostly flat to slightly higher ahead of the open, with the ES up around 0.7% and the NQ up roughly 1.2%, as investors weighed the oil-price relief against broader geopolitical uncertainty. The 10-year Treasury yield held near 4.95%.