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Saudi Aramco to Supply Full September Oil Allocations to 3 European Refiners

Created at 19 Aug · 5:06 PM1 source↑ Market-relevant
IN SHORT

Saudi Aramco will provide full contractual crude volumes to at least three European refiners for September, utilizing alternative export routes via Egypt and ship-to-ship transfers off Malta due to ongoing disruptions in traditional shipping lanes.

Key Numbers

3European refiners receiving full September oil allocations
2 million barrelscrude per VLCC loading at Ras Tanura/Juaymah

Who's Involved

Saudi Aramco
Oil producer supplying full September allocations to European refiners
Bloomberg
Reported on the oil allocations via The Edge Malaysia
European refiners
Recipients of full September crude oil volumes
Saudi Aramco to Supply Full September Oil Allocations to 3 European Refiners

↳ Why This Matters

The decision by Saudi Aramco to supply full oil allocations to European refiners via alternative routes provides much-needed supply certainty for the region, mitigating some of the immediate impact of geopolitical tensions on energy markets.

Key facts

  • Saudi Aramco will supply full contractual crude volumes to at least three European refiners for September.
  • Deliveries will be sourced from Egypt, Saudi Arabia, and through ship-to-ship transfers off Malta.
  • The alternative routes are being used due to disruptions in the Strait of Hormuz and Red Sea.
  • Aramco resumed loadings at Ras Tanura and Juaymah last week after a three-week interruption.

Saudi Aramco has confirmed it will provide full contractual crude oil volumes to at least three European refiners for their September allocations. This assurance comes as the kingdom navigates disruptions to its primary maritime export routes, the Strait of Hormuz and the Red Sea, due to ongoing conflicts.

Deliveries will be facilitated through alternative channels, including Egypt's Mediterranean port of Sidi Kerir and ship-to-ship transfers off Malta. Two European refiners are set to receive their crude from Sidi Kerir, while a third has the option to choose between Sidi Kerir, Saudi Arabia's Red Sea port of Yanbu, or the ship-to-ship transfer option. Aramco notified its European customers approximately one week later than usual regarding these allocations.

The move to divert crude north through Egypt to Sidi Kerir has become a more prominent strategy as shipowners increasingly avoid the Houthi-threatened Bab el-Mandeb Strait. This comes as Aramco recently resumed loadings at its Persian Gulf ports of Ras Tanura and Juaymah last week, following a three-week interruption. The company is reportedly facing challenges placing some September barrels with Asian customers, who are also hesitant to load at Yanbu due to security concerns.

Frequently asked questions

Saudi Aramco is using alternative routes like Egypt's Sidi Kerir port and ship-to-ship transfers off Malta due to disruptions in the Strait of Hormuz and the Red Sea, caused by regional conflicts.

The report states at least three European refiners will receive full contractual crude volumes, but does not name them.

Aramco resumed loadings at Ras Tanura and Juaymah last week, following a three-week interruption.

What Happens Next

01Monitor European refiner acceptance of allocated volumes.
02Observe any further changes in shipping routes or security incidents affecting oil exports.
CME Headlines
  • WTI Crude Oil futures drop as Middle East supply risks linger.
    18 Aug · 8:50 PM
  • WTI Crude Oil futures drop as Middle East supply risks linger.
    18 Aug · 8:50 PM
  • Copper futures drop to cycle lows ahead of FOMC minutes.
    18 Aug · 8:37 PM

How It Developed

Saudi Aramco will supply full contractual crude volumes to at least three European refiners in September.
Deliveries will be made from Egypt, Saudi Arabia, and via ship-to-ship transfers off Malta.
Two refiners will receive barrels from Egypt's Sidi Kerir port.
A third refiner can choose between Sidi Kerir, Saudi Arabia's Yanbu port, or a ship-to-ship transfer.
Aramco notified European customers about a week later than usual.
Saudi Arabia resumed loadings at Ras Tanura and Juaymah last week after a three-week interruption.
Aramco began offering additional Sidi Kerir cargoes last month as shipowners pulled back from the Red Sea route.
Several Asian customers are pushing back against loading at Yanbu due to Houthi threats.

Sources

T1
Saudi Aramco Gives Full September Oil Allocations to 3 European RefinersOilPrice.com

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