Aramco Offers Crude Oil Bypassing Strait of Hormuz Amid Security Concerns

Saudi Aramco has begun offering crude oil to some Asian refiners through private negotiations, bypassing the Strait of Hormuz. This move is similar to that adopted by Abu Dhabi National Oil Co. (ADNOC) in the United Arab Emirates.

The offers are for Arab Medium and Arab Heavy crude, which will be supplied via ship-to-ship transfers off Fujairah in the UAE. One source stated that the cargoes were for September loading.

This strategy is a response to the prolonged disruption to the Strait of Hormuz due to the US-Israeli war on Iran and attacks by Yemen's Houthis on vessels in the Red Sea. Aramco has also diverted its Arab Light crude to the Red Sea port of Yanbu for export since the conflict began.

The arrangements allow Asian refiners to receive crude without sending their own tankers through the strait, where security concerns have deterred many shipowners from entering. This move is seen as a way for Aramco to maintain its market share in key consuming markets such as India.