Saudi Aramco oil exports surge, straining Gulf of Oman STS capacity
by@Reuters
Summary
Ship-to-ship oil transfers in the Gulf of Oman have reached their capacity limits due to a surge in Saudi oil exports, which have increased from about 900,000 barrels per day in August to an anticipated 3.6 million barrels per day for September. This dramatic rise in exports follows the diversion of shipments through the Strait of Hormuz following attacks on the East-West Pipeline, disrupting the supply chain from the Red Sea. As a result, the demand for Very Large Crude Carriers (VLCCs) has skyrocketed, leading to record freight costs and longer queues for transfer services, prompting buyers to explore alternative locations for cargo transfers outside of the congested Strait of Hormuz.
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Analysis
Kpler: Kpler is a data and analytics firm specializing in commodity flows, shipping movements, and energy market intelligence. Its tracking has documented the rebound in Saudi crude exports routed via the Strait of Hormuz this month due to pipeline disruptions. The firm's assessments have highlighted resulting strains on tanker availability and transfer infrastructure in the Gulf of Oman. S-Oil: S-Oil is a major South Korean refiner with majority ownership by Saudi Aramco, focused on processing imported crude into fuels and petrochemicals for domestic and regional markets. It has arranged very large crude carrier shipments to conduct ship-to-ship transfers at alternative locations such as off the west coast of India to accommodate supply adjustments. These moves support its refining operations amid broader Middle East export rerouting. Saudi Aramco: Saudi Aramco is Saudi Arabia's state-owned national oil company responsible for the exploration, production, refining, and global marketing of crude oil and petroleum products. The company has redirected substantial export volumes through the Strait of Hormuz following an attack on its East-West Pipeline that halted flows from the Red Sea port of Yanbu. This shift has increased demand for supertankers and ship-to-ship transfer services in the Gulf of Oman. Export Routing: Saudi oil exports have been redirected through the Strait of Hormuz after disruptions to Red Sea pipeline infrastructure. Market Response: Buyers are seeking alternative cargo transfer locations or direct deliveries to refineries to avoid congestion in traditional offshore areas. Shipping Logistics: Tanker operators are experiencing longer queues and extended processing times for ship-to-ship transfers near the Strait of Hormuz.
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macropolitics