Saudi Arabia’s biggest oil export terminal is finally stirring back to life, and that’s a much bigger deal than another headline about the Strait of Hormuz reopening.
After sitting largely idle since early March, Saudi Aramco is preparing to resume crude loadings at Ras Tanura, with multiple very large crude carriers owned by Bahri moving toward the Ju’aymah offshore loading area on Thursday, according to Bloomberg vessel-tracking data.
The past week has been filled with headlines about the reopening of the Strait of Hormuz, but reopening a waterway and restoring the region’s largest export machine are two very different things. Saudi Arabia never completely stopped exporting during the crisis, thanks to its East-West Pipeline that diverted millions of barrels per day to the Red Sea port of Yanbu. Ras Tanura, however, remained conspicuously quiet until now.
This suggests that Riyadh believes conditions have stabilized enough to begin restoring exports from its primary Persian Gulf outlet.
It also explains why crude prices have continued to soften.
Markets are no longer pricing hypothetical barrels. They’re watching actual tankers line up at loading buoys.
Still, traffic through the Strait of Hormuz remains well below pre-war levels, and many tanker owners continue to approach the region cautiously despite lower war-risk insurance premiums. Earlier this week, freight rates for Gulf crude carriers increased as producers rushed to secure limited vessel capacity.
The movement of Bahri’s fleet suggests Saudi Arabia is preparing for a more sustained increase in shipments. Bloomberg data also shows several additional Bahri supertankers waiting outside the Gulf of Oman, likely positioning for future cargoes.
Iraq is ramping up exports. Kuwait is restoring production. Iran has resumed marketing crude across Asia. And now Saudi Arabia’s flagship export terminal is coming back online.
The supply disruption that sent oil soaring above $100 per barrel is fading into the rearview mirror.
The rebuilding process, however, is only just getting started.
By Julianne Geiger for Oilprice.com
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