Jake Fox
Crude oil’s price move is not stated in the available figures; Saudi oil exports through the Red Sea instead face sharply higher shipping costs and uncertain loadings at Yanbu.
Red Sea route raises the cost of Saudi oil exports
War risk insurance for tankers calling at Yanbu has climbed to about 3% of a vessel’s value, up from less than 1% in early July. At Jizan and other ports farther south, quoted premiums can reach 7%. For comparison, Hormuz voyages are priced at 6% to 9%.
Those rates translate into millions of dollars per voyage. Insurance from Yanbu can cost roughly $3 million, while a trip from southern ports or through Hormuz can reach $7 million. Before the war, the bill was at least $100,000. Chartering a tanker now costs at least $500,000 per day, with bunker fuel adding $100,000 or more.
Pipeline outage redirected barrels toward Hormuz
Saudi Arabia built the East West pipeline to move crude across the country to Yanbu and reduce dependence on the Strait of Hormuz. After Iranian restrictions cut traffic through the strait, the line had been carrying roughly 4 million barrels per day.
Drone attacks shut the pipeline earlier this month. Saudi Aramco has restarted it at lower rates, but Yanbu crude loadings had not resumed as of Thursday, despite earlier reports that shipments were scheduled. The supplied figures do not include a crude price or a USO exchange traded fund quote, so they do not establish whether oil prices rose or fell.
Ras Tanura sales leave buyers facing route uncertainty
With the pipeline disrupted, Saudi Arabia turned back toward the Persian Gulf. Aramco sold roughly 60 million barrels for September and October loading from Ras Tanura. Those barrels moved through Hormuz before ship to ship transfers near Sohar. Asian buyers took much of the oil, while some European term customers were told they would receive no Saudi crude in October.
The Red Sea route is not free of security risks. The Houthis have threatened Saudi linked vessels near Bab el Mandeb. Shipping companies see a difference between the two chokepoints: U.S. forces have provided some aerial support around Hormuz in recent months, while no comparable protection is operating in the Red Sea.
Frequently Asked Questions
How does saudi arabia export oil?
Saudi Arabia sends crude through pipelines to export terminals, including Yanbu on the Red Sea and Ras Tanura on the Persian Gulf. Tankers carry the oil to international buyers.
Can saudi export oil from red sea?
Yes. Yanbu is a Saudi Red Sea export port, supplied by the East West pipeline. The source reports that Yanbu loadings had not resumed as of Thursday.
How much oil does saudi arabia export?
The supplied figures do not state total exports. They report roughly 60 million barrels sold for September and October loading from Ras Tanura.
How much oil does saudi arabia produce?
No national production total is given. The East West pipeline had been moving roughly 4 million barrels per day to Yanbu, which is a pipeline flow figure, not total production.
Does saudi arabia export oil via red sea?
Yes. Yanbu provides a Red Sea outlet, although the reported disruption left crude loadings there on hold as of Thursday.
Holly Herrera
James Stephens