Aramco Reroutes Crude Exports as Strait of Hormuz Attacks Slow Shipping

Saudi Aramco, the world's largest oil firm, is attempting to reroute some of its crude exports to bypass the Strait of Hormuz where attacks have slowed shipping to a near halt. The company hopes to avoid production cuts by redirecting oil to its Red Sea port of Yanbu.

The East-West Pipeline has limited capacity and could become a target for attacks by Iran's allies, with a capacity of 5 million barrels per day (bpd). In 2019, the pipeline temporarily handled 7 million bpd after natural gas liquid pipelines were converted to carry crude. Saudi Arabia produced just over 10 million bpd of crude in January.

Aramco has informed some buyers of its Arab Light crude that they must load cargoes at Yanbu, but there are logistical trade-offs involved due to the reduction of NGLs takeaway capacity and the rate the Yanbu crude terminal on the Red Sea can sustainably load vessels. Crude loadings at Yanbu hit a peak of just under 1.5 million bpd in April 2020.