r/news • u/MoesOtherBar • 20h ago

Saudi Arabia shut down East-West crude oil pipeline after multiple attacks

https://www.cnbc.com/2026/09/11/saudi-arabia-shut-down-east-west-crude-oil-pipeline.html
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u/Jetavator 20h ago

demand destruction?

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u/WhiskeyBike 20h ago

China dropped oil imports a few months ago basically overnight, by like 40%

They have a huge reserve, so them cutting imports is basically the only keeping oil prices from spiking as much as they normally would have.

They have began increasing their oil imports again, so their effect on keeping costs low elsewhere on the planet will continue to subside, and we will get price increases that continue to get worse and worse

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u/Jetavator 20h ago

thank you

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u/999BusinessCard 19h ago

You’re welcome

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u/RestaurantOk8066 20h ago

China has large reserves and pulled back on oil purchases at the outbreak of the war, keeping demond low(er) than it would otherwise be.

https://www.cnbc.com/2026/09/10/china-crude-oil-iran-hormuz-war-trump-brent-prices-.html

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u/Jetavator 20h ago

thank you

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u/organasm 20h ago

They are pulling oil from their own reserves since Hormuz is closed. Don't know how long they'll continue to do so. That destroyed enough demand to keep oil prices from going higher than they are. But we also were pulling out of our reserves and that's drying up, too.

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u/TheYear1414 20h ago

The main difference is China managed to expand their renewable energy production by a jaw-dropping amount meanwhile in the US the White House rolled out coaly the favorite coal mascot of all kids in West Virginia who hope to one day work in the mines of their forefathers.

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u/aerost0rm 19h ago

Not only did we roll out coaly, we cancelled renewable contracts or bought them out of them. Making sure we are guaranteed
To have a depression due to an energy crisis. Housing crisis, energy crisis, food crisis. Deportation crisis, government crisis, etc, etc

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u/powercow 18h ago

yup we paid companies to not increase power production because it was woke, right when we need power the most.

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u/Blizreme 16h ago

And 30% of the country loves it.

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u/TrulyOutrageous42 15h ago

They took "never let a good crisis go to waste" and thought "but what if we MADE the crisis and were ready to buy everything up?"

Like... Vance is buying up farms, Trump is just scraping 401k deposits when he sells his market manipulations, Lutnick stole from everyone... it's bonkers how stupid MAGA voters are.

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u/le_user 19h ago

A minor point about "demand destruction": while your description is correct about China helping to keep the global price lower by not importing as much, "demand destruction" actually refers to a scenario where the price gets so high that no one will buy it.

For example, in regular times, oil producers are happy when the price rises as they will make more money. But if the price spirals out of control they actually lose money because no one will buy anymore.

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u/ElegantBiscuit 18h ago

Yeah, China reduced their demand on the international market temporarily. Demand destruction specifically refers to not just the price but also the duration, where it is so high for so long that people change their behavior and switch to alternatives. If and when the price does come back down, the downstream economic activity derived from that product no longer exists. We are already seeing that with rising global EV demand and rising hybrid demand in the US - where if the price of gas does come down, the sales volume and demand will likely never be as high as it was.

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u/Jetavator 20h ago

thank you

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u/BlueSwordM 14h ago

Luckily, they're all on electrical EVERYTHING.

That gives them an incredible edge to keep oil purchases only for necessary things.

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u/LLMprophet 15h ago

In that case it was China holding back (reducing demand on purpose), but eventually demand destruction happens involuntarily everywhere (aka prices too high for more and more people/businesses/uses).

China couldn't hold back any more and they're back to buying which is part of why oil jumped up ~10% in the last week.

A massive problem is, once oil prices are that high the global economy can grind to a halt and destroy businesses en masse.