Why is Aramco rerouting its oil exports away from Hormuz
Saudi Aramco, the world's biggest oil company, is attempting to reroute some of its crude exports to the Red Sea port of Yanbu instead of the usual route via the Strait of Hormuz.
Why? A spike in ship attacks has made that old path risky—especially since Hormuz handles about 20% of all global oil traffic.
East-West Pipeline
The East-West Pipeline stretches nearly 1207km and has a nominal capacity of about 5 million barrels a day and has been able to handle up to 7 million barrels a day after temporary conversions and debottlenecking, but Yanbu port usually ships less than 2 million barrels daily.
Shipments for Asia transit the Red Sea and Bab el-Mandeb, while some deliveries to Europe can be routed via Yanbu to Ain Sukhna and through Egypt's Sumed pipeline.
Global markets on edge
With tensions rising in the region (Aramco even had to shut down its Ras Tanura refinery after a drone attack), this reroute is all about keeping exports steady.
But here's the catch: Saudi Arabia and UAE together can only bypass about 2.6 million barrels per day—way less than what flows through Hormuz—so global markets are still on edge if things get worse.