Crude oil exports from Saudi Arabia's Red Sea Yanbu port rose to nearly 4 million barrels per day last week, a sharp increase from export levels before the Iran war broke out, shipping data shows.
The jump shows that Saudi Aramco, the world's biggest oil exporter, is making progress on a plan to send crude along its East-West pipeline to Yanbu to keep supplies flowing and offset the effective closure of the Strait of Hormuz due to the conflict.
Aramco can pump up to 7 million bpd to Yanbu through the pipeline, around 5 million bpd of which could be available for export, with the rest supplying local refineries, the company said on March 10.
In February, total Saudi crude exports exceeded 7 million bpd, according to Kpler, most of which passed through the Strait of Hormuz.
EXPORTS VIA YANBU EXPECTED TO RAMP UP
Crude exports via Yanbu have averaged about 2.9 million bpd so far in March, data from Kpler showed, broadly in line with figures provided by LSEG. This marks a sharp increase from an average of 770,000 bpd in January and February.
In the week starting March 16, exports surged to near 4 million bpd, according to Kpler, LSEG and ship broker Clarksons, and are expected to ramp up further.
"We expect this upward trend to continue, with exports potentially reaching around 5 million bpd by the end of the month, which would be close to Yanbu's maximum loading capacity,” Kpler analyst Johannes Rauball said.
Analysis from ship broker Braemar showed 33 VLCCs, or very large crude carriers, have lifted oil from Yanbu since February 28.
Average tanker earnings for voyages from the Red Sea to Asia have surged to their highest in nearly six years, reaching nearly $270,000 a day, according to market estimates.
"Middle Eastern crude tanker markets remain chaotic with many Saudi Arabian cargoes now re-routed via Yanbu," ship broker BRS said in a report on Monday.
Yanbu briefly halted loadings last week after an Iranian drone attack on a refinery there.
In the United Arab Emirates, which has also relied on its own pipeline to divert crude shipments, crude exports from the port of Fujairah on the Gulf of Oman have risen too.
Exports from Fujairah have averaged 1.62 million bpd so far in March, up from 1.17 million bpd in February, Rauball said.
Exports dropped to 790,000 bpd last week, down from 2.2 million bpd in the week beginning March 9, following Iranian attacks on the port.
(Reuters)
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