Saudi Arabia has sold as many as 60 million barrels of crude oil from the Persian Gulf port of Ras Tanura for September and October loadings outside the Strait of Hormuz via ship-to-ship transfers, trade sources told Reuters on Friday.
Saudi oil giant Aramco has offered buyers of the crude from the Ras Tanura port to be loaded via ship-to-ship (STS) transfers at the port of Sohar in Oman just outside the Strait of Hormuz, according to the sources.
Saudi Arabia has hiked shuttle-shipping to the Strait of Hormuz this week, after it was forced late last week to shut down the onshore East-West pipeline that allowed the Kingdom to bypass the Strait and export crude oil from the port of Yanbu on the Red Sea.
Late last week, Saudi Arabia shut down its East-West oil pipeline following drone attacks launched from the territory of Iraq close to the Iranian border on Thursday.
Thanks to the 750-mile-long East-West pipeline, the Kingdom has managed to re-route most of its crude loadings from its eastern ports in the Persian Gulf to the Red Sea port of Yanbu.
Now Saudi Arabia is pivoting back to Hormuz to keep crude exports at a reasonable level as it struggles to remain a reliable oil supplier.
The volumes from Hormuz are being picked up mostly by refiners in China and South Korea, although some cargoes have been booked for Japan and India, Reuters’ sources said.
The rise in Saudi crude oil exports through the Strait of Hormuz has capped the upside in oil prices despite the outage of the East-West pipeline.
Early on Friday, oil prices were set for a weekly decline after a three-week series of gains, as fears about Saudi Arabia’s ability to continue exporting oil appeared to have been quelled by reports about ship-to-ship transfers in the Gulf of Oman.
By Tsvetana Paraskova for Oilprice.com
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