Ship-to-ship (STS) oil transfers in the Gulf of Oman have reached operational limits as Saudi crude exports surge. A pipeline attack on September 13 halted exports from the Red Sea port of Yanbu, prompting state-run Saudi Aramco to increase shipments through the Strait of Hormuz.
Aramco has sold more than 60 million barrels for STS transfer off Sohar, Oman, for September and October. The rerouting has sharply increased demand for Very Large Crude Carriers (VLCCs) to move oil through the strait, reducing vessel availability and raising shipping costs.
Saudi crude exports via Hormuz are projected to reach 3.6 million barrels per day (bpd) in September. They were 900,000 bpd in August. Meeting the increased demand is expected to require 36 to 40 additional VLCCs, tightening the tanker market and delaying cargo arrivals at refineries.