Yanbu Port Blocked by Houthi Forces; Saudi Arabia Returns to "Stealth Sailing" in Hormuz

After the alternative export route at the Red Sea’s Yanbu Port was cut off due to a maritime blockade by Houthi forces, Saudi Arabia is restarting “dark shipments,” increasing the volume of crude oil transported through the Strait of Hormuz, and switching to ship-to-ship transfers off the coast of Oman to avoid direct passage risks through the Strait.

Last week, Saudi Aramco ended the three-week suspension of crude loading at Ras Tanura and Juaymah terminals in the Strait of Hormuz, resuming crude exports; at the same time, it began offering ship-to-ship sales in the Sea of Oman near Sohar, targeting Arab Medium and Arab Heavy crude.

The immediate impact of the Red Sea route disruption is that part of Saudi exports have been forced to shift to Egypt’s Sidi Kerir terminal. This month, shipments to Asia are expected to be only about 670,000 barrels per day, a sharp decline compared to the previous 4 million barrels per day exported via Yanbu Port.

This adjustment indicates that Saudi Aramco may be following the example of the UAE, sending more tankers through the Strait of Hormuz while maintaining exports via ship-to-ship transfers outside the strait; however, the longer transit distance and higher freight costs pose challenges to the cost and sustainability of this detour strategy.

Red Sea Exit Blocked, Alternative Route Fails

Previously, to avoid risks in the Strait of Hormuz, Saudi Aramco rerouted a large share of its crude exports through the Red Sea’s Yanbu Port, with volumes once reaching around 4 million barrels per day.

However, in recent weeks, the Houthi forces in Yemen announced a maritime blockade against Saudi Arabia, rendering this alternative route inoperative.

Subsequently, Saudi Aramco turned to supplying via Egypt’s Sidi Kerir terminal, but shipments to Asia this month are expected to reach only about 670,000 barrels per day; the longer transit distances and increased freight costs have further weakened the viability of this rerouted plan.

After Three-Week Suspension, Resumes Loading at Hormuz

Last week, Saudi Aramco resumed crude loading at Ras Tanura and Juaymah terminals inside the Strait of Hormuz, ending a three-week halt.

The supertankers Malaysia Prosperity, Algeria Prosperity, and Singapore Prosperity each loaded around 2 million barrels of crude oil between August 12 and 16.

Preliminary data from Kpler indicates that later this month, another six VLCCs may load Saudi crude inside the strait; satellite imagery also shows that ships with transport capacity of at least 9 million barrels have completed loading at or near the Ras Tanura export facility in the past week.

Previously, following last month’s escalation of the US-Iran conflict and attacks on its tanker fleet, Saudi Arabia suspended sales within the strait for several weeks, and this resumption does not indicate a return to normal export levels.

Ship-to-Ship Transfers Off Oman to Avoid Strait Risks

To lower the risks of direct passage through the strait, Saudi Aramco has started ship-to-ship sales in the Oman Bay regions such as Sohar, targeting Arab Medium and Arab Heavy crude, indicating that these supplies likely originate from within the Persian Gulf.

This move shows Saudi Arabia may be following the UAE’s example by sending more crude through the Strait of Hormuz.

Meanwhile, Saudi Aramco continues to supply crude oil to Asian refineries via ship-to-ship deliveries off Fujairah, allowing buyers to take delivery without deploying their own vessels through the strait.

Further developments to watch include the sustainability of VLCC loadings inside the Strait of Hormuz, and whether export volumes from Egypt’s Sidi Kerir terminal can recover.