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Market Chatter: Asian Refiners Mull Suez Canal Route for Saudi Crude to Dodge Houthi Attacks

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Asian refiners are considering the route through the Suez Canal and around Africa for the shipment of Saudi Arabian crude from the Red Sea Port of Yanbu amid the naval blockade threat to the kingdom by Yemen's Houthis group, Reuters reported Tuesday.

The voyage from west of Yanbu port after crossing Egypt, the Suez Canal and Africa's Cape of Good Hope is expected to add at least four weeks of travel time, while increasing freight and fuel costs, versus the conventional route east of Yanbu to the Arabian Sea, the report said, citing analysts and industry experts.

Refiners have been forced to look for alternative routes and supplies since the start of the Iran war in late-February, which resulted in the effective closure of the Strait of Hormuz.

Two Asia-bound Saudi Arabian crude-carrying tankers turned back in the Red Sea on Tuesday after Houthi threats, while traffic through the Strait of Hormuz continued to decline this week, the report said.

(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)

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