Saudi Arabia is sending more oil through the Strait of Hormuz and arranging crude transfers off Oman after its East-West Pipeline to Yanbu was shut following drone attacks. Loadings at the Red Sea port remain suspended, while several cargoes scheduled for Europe have been cancelled.
Saudi Aramco is now offering Asian customers Arab Light, Arab Medium and Arab Heavy crude for loading off Sohar, Oman, according to sources cited by Reuters. The oil is first loaded inside the Gulf, taken through Hormuz, then transferred from one tanker to another once it has cleared the strait.
Three pumping stations hit
New details released on Thursday showed that the 11 September attack damaged three pumping stations, up from two initially reported. The 1,200-kilometre pipeline has 11 pumping stations and links Saudi Arabia’s eastern oilfields to Yanbu on the Red Sea. Saudi authorities said the drones were launched from Iraq.
Before the shutdown, the pipeline was carrying 4 to 5 million barrels a day, equivalent to around 4% to 5% of global oil supply. It had become Saudi Arabia’s main route for bypassing Hormuz as shipping through the strait fell sharply during the war.
Repair timelines remain uncertain. Three sources cited by Reuters said full repairs could take up to five or six weeks, while another said a partial restart could come sooner. Bloomberg reported that Riyadh was seeking to restore roughly half of the pipeline’s capacity within days.
From the Gulf to Sohar
In the meantime, Aramco has increased loadings at Ras Tanura and Juaymah, two terminals inside the Gulf. They reached around 4 million barrels a day last week, roughly double the previous pace, according to Energy Aspects.
Some of those barrels are then shipped through Hormuz and transferred offshore near Sohar onto other tankers. For Asian refiners, this means taking delivery after the most exposed passage has already been crossed, without sending their own vessels all the way into Saudi terminals inside the Gulf.
The move is therefore pushing part of Saudi exports back through Hormuz at the same time as the land route built to avoid the strait remains offline. On Wednesday, only three commercial vessels were detected transiting Hormuz, compared with an average of 17 a day over the previous ten days. The figures may understate actual traffic, as some ships sail with their AIS transponders switched off.
European cargoes cancelled
The Yanbu shutdown is already affecting European buyers. Aramco has informed customers that some September cargoes have been cancelled. Poland’s Orlen, which sources around 40% of its crude from Aramco, has turned to North Sea grades and also sought barrels from Algeria, the United States and Kazakhstan.
The disruption pushed some prompt physical crude cargoes in Europe above $130 a barrel this week. European gasoil contracts, a key benchmark for diesel prices, also hit a record on Tuesday. Oil prices eased on Thursday, with Brent falling back to around $103 a barrel after Saudi Arabia offered more volumes via Oman and efforts continued to restore the pipeline.