Saudi Aramco is studying new routes for exporting crude oil and expand its international storage capacity as part of a strategy to maintain continuity of supply in the face of potential disruptions.
The president and CEO of the Saudi oil company, Amin Nasser, explained during a visit to Tokyo that the company is currently evaluating a fourth and fifth route for its exports. These alternatives would be in addition to the corridors that Aramco already uses to transport oil to international markets.
According to Nasser, the company existing infrastructure and logistical flexibility allow it to recover affected operations within days. Furthermore, Aramco can redistribute its shipments across different routes when difficulties arise on any of its regularly used corridors.
Saudi Aramco diversifies its export routes
Two strategic points concentrate a large part of the oil traffic in the Middle East, one is the Strait of Hormuz and the other is Bab el-Mandeb, located at the southern entrance to the Red Sea.
However, Saudi Aramco it has other alternatives for moving its crude oil, including the Saudi Arabian East-West pipeline, which allows transporting oil to the Red Sea coast, as well as access to the Sumed system in Egypt.
The Sumed pipeline is approximately 320 kilometers long and connects the Red Sea to the Mediterranean through Egyptian territory. This infrastructure provides an additional option for transporting crude oil when conditions necessitate changes to the usual maritime routes.
Nasser noted that having several alternatives allows Aramco to direct a greater number of ships to specific corridors depending on the circumstances and continue supplying its customers.
A fourth and fifth route for Saudi crude
Saudi Aramco intends to further expand this flexibility by developing new corridors for its oil exports, the company is already conducting engineering and feasibility studies related to a fourth and fifth route. For now, Nasser has not revealed what their potential routes would be or when they might begin operating.
The alternatives are still in the evaluation phase, if they move forward, they would expand the logistical options available for Saudi crude and reduce the supply chain’s exposure to disruptions in maritime corridors or existing infrastructure.
Japan gains importance for oil storage
Saudi Aramco strategy also includes increasing its storage capacity outside of Saudi Arabia, Japan is among the countries being considered for this expansion. The oil company is in talks with authorities and its partners in the country to explore a possible increase in its crude oil storage capacity.
Having larger volumes stored near strategic markets would allow for a faster response to temporary disruptions and provide more options to guarantee deliveries.
In this way, the combination of international storage, pipelines and different maritime corridors strengthens Saudi Aramco’s ability to manage its supply chain.
Aramco is betting on an oil network with more alternatives
The strategy presented by Amin Nasser seeks to reduce operational dependence on specific routes through a transport and storage network with a greater number of alternatives.
Within this framework, the Strait of Hormuz it remains a vital route for the region’s oil exports, at the same time, the East-West pipeline, Bab el-Mandeb, and access to the Sumed system allow for the rerouting of shipments when circumstances require it.
With studies to develop new routes and the possible expansion of its storage capacity in Japan, Saudi Aramco seeks to further strengthen its responsiveness and maintain the supply of crude oil to its customers even when disruptions occur in certain corridors.
Source: Asharq AI Generation
Photo: Shutterstock
