Saudi Oil Export Rerouting Triggers Gulf of Oman Congestion

Recent attacks by Yemen's Houthi rebels have led Saudi Arabia to reroute its crude oil exports, causing congestion in the Gulf of Oman. According to Reuters, Saudi Aramco has shifted over 60 million barrels of crude oil scheduled for delivery in September and October to be sold via ship-to-ship transfers off the coast of Sohar, Oman.

This change has pushed maritime transfer infrastructure in the region to its capacity limit. Energy analytics firm Kpler projected that Saudi Arabia's crude oil exports passing through the Strait of Hormuz this month will surge fourfold to 3.6 million barrels per day, up from 900,000 barrels per day last month.

The increase in daily volumes has led to a shortage of Very Large Crude Carriers (VLCCs), with an additional 36 to 40 vessels becoming necessary. This has driven up charter rates, with the daily time charter rate for a VLCC transporting crude from the Middle East to China hitting a record high of $1.27 million on September 23.