Asian refiners look to Suez Canal to move Saudi oil amid Houthi shipping threats

Shipping west toward Egypt from Saudi Arabia's Red Sea port of Yanbu, and passing through the Suez Canal and rounding the Cape of Good Hope in Africa, will require as much as four additional weeks and raise freight and fuel costs, analysts and industry experts have warned, compared with the typical route of heading east from Yanbu to the Arabian Sea.

Liberia-flagged vessel Rodos, which loaded crude oil at Yanbu and headed to India's west coast, was pointing west and signaling the Suez Canal, ship-tracking data via LSEG and Kpler showed on Tuesday.

South Korean refiner Hyundai Oilbank was seeking a Very Large Crude Carrier on Tuesday to load oil at Yanbu with the option of using the Suez Canal and Egypt's SUMED pipeline, which links the Red Sea and Mediterranean Sea, to head to South Korea, according to a shipping source.

A fully loaded VLCC cannot traverse the Suez Canal due to its draft limit and shippers often lighten the vessel's load on the Red Sea side before entering the canal by moving a portion of the oil on Egypt's SUMED pipeline. The ship picks up the oil on the Mediterranean side after it passes the Suez Canal with a lighter load.