Saudi Arabia has sold as many as 20 million barrels of crude oil in the spot market this week after shutting down the key onshore pipeline that lets it bypass the Strait of Hormuz, unnamed traders told Bloomberg on Wednesday. The cargoes are to be picked up from just outside the Strait of Hormuz, with buyers loading them via ship-to-ship transfers in the Gulf of Oman rather than sending tankers into the Persian Gulf. Chinese refiners, including state-held giants and independent refiners, along with crude processors in other East Asian countries, have been the main buyers of the Saudi spot offerings. Late last week, Saudi Arabia shut down its 750-mile-long East-West pipeline following drone attacks launched from Iraqi territory close to the Iranian border. After the outage, Saudi oil giant Aramco has reportedly canceled or delayed some September deliveries to European refiners. The ship-to-ship transfer approach has been perfected in recent months by the United Arab Emirates, whose national oil company ADNOC has offered prompt supply in multiple tenders both within the Persian Gulf and the Fujairah-Sohar range outside the Strait of Hormuz.
Drone attack forced shutdown of Aramco's East-West pipeline, prompting spot sales and canceled/delayed September deliveries.
ADNOC's ship-to-ship transfer model is cited as the template Saudi Arabia is now using for prompt Gulf of Oman supply.
