Saudi Aramco increases Yanbu port crude oil exports to offset the impact of the Strait of Hormuz closure

Shipping data shows that last week, crude oil exports from the Red Sea port of Yanbu in Saudi Arabia rose to nearly 4 million barrels per day, a significant increase compared to pre-Iran war export levels.

This surge indicates that Saudi Aramco, the world’s largest oil exporter, is advancing its plan to transport crude oil to Yanbu via the east-west pipeline to maintain supply flow and offset the impact of the actual closure of the Strait of Hormuz caused by conflict.

On March 10, Saudi Aramco stated that the company can deliver up to 7 million barrels per day of crude oil to Yanbu through this pipeline, with about 5 million barrels per day available for export and the rest supplied to local refineries.

According to Kpler data, Saudi Arabia’s total crude oil exports exceeded 7 million barrels per day in February, most of which were transported through the Strait of Hormuz.

Yanbu export volume is expected to increase further

Kpler’s data shows that, so far in March, crude oil exports through Yanbu port averaged about 2.9 million barrels per day, which is consistent with data from the London Stock Exchange Group. This is a substantial increase from the average of 770k barrels per day in January and February.

Based on data from Kpler, the London Stock Exchange Group, and shipbroker Clarkson, during the week of March 16, exports surged to nearly 4 million barrels per day and are expected to increase further.

Johannes Laubor, an analyst at Kpler, said, “We expect this upward trend to continue, with exports possibly reaching about 5 million barrels per day by the end of the month, approaching Yanbu port’s maximum loading capacity.”

Analysis from shipbroker Braemar shows that since February 28, 33 very large crude carriers (VLCCs) have loaded oil from Yanbu port.

Market estimates suggest that the average earnings for tankers traveling from the Red Sea to Asia have soared to the highest levels in nearly six years, reaching nearly $270k per day.

In a report on Monday, BRS, a shipbroker, stated, “The Middle East crude oil tanker market remains chaotic, with many Saudi cargoes now rerouted to be exported via Yanbu port.”

Last week, after Iran launched a drone attack on a refinery at Yanbu port, the port temporarily suspended loading operations.

Similarly, the United Arab Emirates, which also relies on its own pipelines for crude oil diversion, saw increased crude exports from the port of Fujeirah in the Omani Gulf.

Laubor said that so far in March, Fujeirah’s exports averaged 1.62 million barrels per day, higher than February’s 1.17 million barrels per day. After Iran attacked the port, exports last week dropped from 2.2 million barrels per day in the week of March 9 to 790k barrels per day.