Aramco's Red Sea Export Plan Hit by Refiner Reluctance Amid Houthi Threats
Asian oil refiners are pushing back against Saudi Aramco's request to collect crude from the Red Sea port of Yanbu due to the escalating threat from Iran-backed Houthi militants. The refiners, including at least two Asian companies, have asked Aramco if they can instead take delivery of their September cargoes from Egypt's Mediterranean port of Sidi Kerir.
The requests underscore the difficulties faced by buyers in navigating one of the world's most critical chokepoints, as Houthi attacks drive up insurance premiums and prompt many shipowners to avoid the route. The Red Sea corridor has become a vital export hub for Saudi Arabia due to the Strait of Hormuz-related risks.
The shift to Sidi Kerir represents a significant logistical adjustment, with the Egyptian terminal connected to the Red Sea via the SUMED pipeline. However, this route adds substantial sailing time for Asian buyers and increases their final costs due to added logistics expenses.