Heightened risks to shipping safety in the Red Sea have prompted some Asian refiners to ask Saudi state oil giant Aramco to pick up its crude oil cargoes at Egypt’s Mediterranean port of Sidi Kerir as vessel owners are increasingly reluctant to pass through the Bab el-Mandeb Strait to enter the Red Sea.
At least two Asia-based refiners have asked Saudi Aramco if they can pick up their purchased oil cargoes next month from Sidi Kerir instead of the Saudi port of Yanbu on the Red Sea, anonymous trading sources told Bloomberg on Monday.
But at least one of these refiners could scrap altogether the monthly term allocation due to the higher costs to ship the crude from Sidi Kerir via the Mediterranean and around Africa to Asia, according to the traders.
Ship owners and operators, as well as refiners in Asia, have been wary of braving the Bab el-Mandeb Strait and the Red Sea in recent weeks, after the Iran-aligned Houthis threatened to blockade Saudi shipments in the area and claimed several attacks on oil tankers since the end of July.
Since the Iran-aligned Houthis in Yemen announced a blockade on Saudi shipments in the southern Red Sea and Bab el-Mandeb Strait, Saudi Arabia has been shuttling on tankers more crude from Yanbu to the Egyptian port of Ain Sukhna on the Red Sea, and then on the SUMED onshore pipeline to the Sidi Kerir port.
Aramco has re-routed some cargoes to Sidi Kerir and asked refiners in South Korea and Japan to pick their September allocated volume at the Egyptian port. But most refiners in China, India, and Taiwan were asked to pick their cargoes from the Red Sea port of Yanbu, Bloomberg’s trading sources said.
The Houthis are allowing China-linked and China-crewed vessels to move in the Red Sea.
By Tsvetana Paraskova for Oilprice.com
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