Oil Price
Tankers carrying nearly 9 million barrels of oil from Saudi Arabia and Iraq will delay their deliveries as they have diverted away from the Red Sea/Suez Canal route in recent days, and are now headed on the longer route via Africa, Bloomberg vessel-tracking data showed on Friday.
The tankers loaded crude oil and petroleum products at Saudi Arabia’s ports of Ras Tanura and Jubail and at Iraq’s port of Basra and were originally headed to Europe via the Red Sea and the Suez Canal. However, those tankers diverted away from the Bab el-Mandeb Strait on or after January 12, Bloomberg’s data showed.
On January 12, the world’s largest shipping and tanker industry groups advised members to stay away from Bab el-Mandeb due to security concerns amid intensified attacks on commercial shipping in the area from the Iran-backed Houthis in Yemen.
The route via the Cape of Good Hope in Africa will increase the voyage time between the Middle East and Europe by about two weeks compared to the Suez Canal route.
This week, another oil supermajor suspended tanker transit through the Red Sea.
Shell has suspended indefinitely all its shipments via the Red Sea/Suez Canal route amid rising tensions in the region and fears of escalating Houthi attacks, The Wall Street Journal reported on Tuesday, citing sources with knowledge of the supermajor’s decision.
In the middle of December, another UK-based supermajor, BP, temporarily suspended all shipments via the route, “in light of the deteriorating security situation for shipping in the Red Sea.”
The tensions in the region have intensified as the Houthis ramped up attacks on commercial shipping in the Red Sea and declared open season on any U.S. ship transiting the area, in response to last week’s U.S.-UK missile strikes on Houthi targets in Yemen.
The U.S. has continued to strike Houthi positions this week.
By Tsvetana Paraskova for Oilprice.com
