Saudi Aramco is expanding its oil supply for cargo outside the Strait of Hormuz during September, several shipments of Saudi crude oil are en route to China. The strategy utilizes ship-to-ship transfers at points located outside this strategic maritime route.
According to sources familiar with the operations, the Saudi oil company began, for the second consecutive week, a sale of Arab Medium and Arab Heavy crude oils to Asian buyers. These sales come after Aramco sold at least 4 million barrels to Chinese customers during August.
Aramco moves oil via STS transfers
For their part, the shipments are offered through STS operations or ship-to-ship transfers off Fujairah, in the United Arab Emirates, and Sohar, in Oman. Both points allow operations to be carried out outside the Strait of Hormuz.
This method allows the oil to be transferred between large vessels before continuing on to its destination markets. This strategy is especially important given the risks affecting maritime traffic in the region.
Furthermore, shipping data indicates that Aramco has used tankers with their tracking systems turned off during certain transits through the strait in order to reduce its exposure to potential attacks.
Saudi oil shipments head to China
Meanwhile, two operations carried out off the coast of Sohar allowed for the preparation of Saudi crude oil shipments destined for China. The movements were recorded by specialized maritime tracking platforms.
The VLCC Singapore Prosperity transferred its cargo to the Xin Hui Yang around August 22nd, the latter is scheduled to arrive at the port of Ningbo, in eastern China, on September 15th.
Additionally, the Algeria Prosperity transferred another cargo to the VLCC Xin Han Yang, the tanker’s arrival in Zhanjiang, in southern China, is scheduled for September 12.
According to available data, Sinopec will receive both shipments; the Chinese company is one of the main players in the refining sector and represents a significant destination for the Saudi oil supply.
Arab Medium and Arab Heavy gain prominence
In parallel, Aramco is concentrating some of the new offerings in Arab Medium y Arab Heavy these grades of crude oil are part of the supply that the company is offering to buyers in Asia through operations carried out outside the Strait of Hormuz.
The oil company also sold at least 4 million barrels of heavy crude to PetroChina and Sinochem during the previous week. These sales came after Aramco resumed oil loadings at the Saudi port of Ras Tanura in early August.
In this way, China maintains a central role among the destinations of Saudi cargoes while Aramco adapts the logistics of its exports to the maritime security conditions of the region.
The Strait of Hormuz influences oil routes
Finally, the importance of the Strait of Hormuz explains the weight of these operations; before the conflict cited by the sources, approximately one-fifth of the world’s oil and gas flows passed through this seaway.
The use of Sohar and Fujairah for ship-to-ship (STS) transfers allows Aramco to maintain operational hubs outside the strait. At the same time, the movements to Ningbo and Zhanjiang demonstrate the continued flow of Saudi oil to the Chinese market despite the increased risk to maritime shipping.
Source: MarineLink
Photo: Shutterstock
