- Saudi Arabia’s East-West pipeline, built in the 1980s and expanded to a capacity of up to 7m barrels per day, has become a critical artery for maintaining global oil supply
- The pipeline illustrates decades of deliberate investment in export redundancy, now providing clear strategic value amid disruptions in the Strait of Hormuz
- Yanbu, its Red Sea terminus, is attracting substantial industrial and clean energy investment aligned with Vision 2030
- The port city’s expanding role as an export and industrial centre reinforces Saudi Arabia’s ambition to position its western coast as a global logistics and manufacturing corridor
Saudi Arabia began construction on the East-West crude oil pipeline in the early 1980s, after tanker navigation in the Gulf was threatened during the Iran-Iraq War. Four decades of quiet investment followed in a piece of infrastructure that, until recently, much of the world had little reason to take notice of. The 1200-km pipeline, known as the Petroline, runs the breadth of the Arabian Peninsula from Saudi Arabia’s eastern oil fields to the Red Sea port of Yanbu, and has a capacity of around 5m barrels per day (bpd) and up to 7m bpd on a temporary basis. With maritime traffic through the Strait of Hormuz now severely curtailed, that investment has come into focus as a means of maintaining the global oil supply.
A strategy built on redundancy
About 20m barrels, or one-fifth of global daily consumption, normally flow through the Strait of Hormuz. Saudi Arabia’s response to the current disruption has been to activate a contingency plan refined over the years. Crude exports from Yanbu reached a five-day rolling average of 3.7m bpd within weeks of the disruption, rising more than fourfold from pre-war levels of below 800,000 bpd. The speed of that activation reflects the depth of preparation. A 2024 Aramco earnings presentation confirmed that work to permanently expand the pipeline’s capacity had been completed.
Saudi Arabia is not alone in having developed infrastructure of this kind, which may have initially seemed somewhat redundant. The UAE operates a 1.5m bpd pipeline from its main fields to Fujairah in the Gulf of Oman, also bypassing the Strait of Hormuz. Oman’s port of Duqm is likewise marketed as a node in the Gulf hydrocarbon export market thanks to its strategic location on the Arabian Sea and a refinery with the capacity to process 230,000 bpd.
Yanbu’s expanding industrial footprint
The most immediate beneficiary of the pipeline’s activated role is Yanbu itself. Saudi Arabia’s second-largest settlement on the western Red Sea coast, the city is home to the Kingdom’s second-largest industrial complex and its port is the largest on the Red Sea. The port spans 6.8 sq km with 34 berths and 10 terminals, capable of handling up to 210m tonnes of cargo annually. The city’s SAMREF refinery, which processes 400,000 bpd, is jointly owned by Aramco (50%) and Mobil Yanbu Refining Company, an ExxonMobil subsidiary (50%). Around 10 km away, the YASREF refinery, with a 430,000 bpd capacity and jointly owned by Aramco (62.5%) and China’s Sinopec (37.5%), is another key industrial node located in Yanbu. In April 2025, Aramco and Sinopec announced a venture framework agreement to expand YASREF to bring its conversion capacity to 4m bpd by 2030.
Renewed investment has continued in 2026. In January of that year, Saudi Arabia’s Public Investment Fund agreed initial terms with Red Sea Aluminium Holdings to develop a fully integrated downstream aluminium complex in Yanbu, introducing advanced smelting technologies and establishing one of the Middle East’s largest continuous casting facilities for high-value downstream products. The project aligns with the Kingdom’s broader strategy of building globally competitive industrial ecosystems and diversifying the Saudi economy beyond hydrocarbons.
The Red Sea corridor and Vision 2030
The longer-term significance of Yanbu’s growing prominence lies in its role within Saudi Arabia’s Vision 2030 framework. The Kingdom’s National Transport and Logistics Strategy seeks to invest more than $2.7bn by 2030 to position Saudi Arabia as a major global logistics hub, with expanded marine fuel and oil infrastructure at Yanbu viewed as vital to handling rising regional and international maritime flows.
Clean energy ambitions are also taking shape on the Red Sea coast. ACWA Power and German utility EnBW have confirmed a partnership to develop the Yanbu Green Hydrogen Hub, a fully integrated facility planned to be ready for commercial operations by 2030. The project will incorporate captive renewable electricity generation, desalination plants, ammonia production and a dedicated export terminal, with 4 GW of electrolysis capacity producing 400,000 tonnes of renewable hydrogen per year.
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