Saudi Aramco resumed crude loadings on Friday at its Ras Tanura terminal in the Gulf after a nearly four-month halt, shipping data showed, as the world’s biggest oil exporter joined a rush to move cargoes amid industry hopes of a return to normal.
The Saudi oil loadings come even though a ship belonging to Taiwan’s Evergreen Marine was hit by an unknown object in the Strait of Hormuz on Thursday.
Middle Eastern producers had been ramping up oil and gas output and exports in the lead-up to the interim deal between the United States and Iran to halt the war and reopen the strait, where a fifth of the world’s oil and liquefied natural gas supplies used to pass.
Two Very Large Crude Carriers controlled by Saudi’s shipping arm Bahri were seen loading crude at Ras Tanura, the world’s biggest oil port, while another waited nearby, the data showed. Each VLCC is capable of loading 2 million barrels of oil.
Saudi Aramco, among the last of the major Gulf producers to resume exports from inside the Gulf, could not be immediately reached for comment outside office hours.
British Navy agency UKMTO paused its operation to escort ships through the strait after the attack on the cargo ship, reigniting concerns about whether the preliminary deal to end the Iran war will hold.
Two U.S. officials told Reuters that Iran had fired on the ship, while Iran’s Persian Gulf Strait Authority, which Tehran established to manage requests for ships to travel through the strait, said vessels outside routes it has set will not be guaranteed safe passage.
RAS TANURA PORT
Ras Tanura sits on Saudi Arabia’s eastern coast on the Gulf and is west of the Strait of Hormuz. It used to export more than 5 million bpd of crude before the conflict. The country’s largest domestic 550,000 bpd refinery is also located at Ras Tanura, which was shut during the war as a precautionary measure.
Aramco last loaded a cargo from the Ras Tanura port for China on March 8, LSEG data showed, and had to divert its exports to the Red Sea port of Yanbu after the Iranian blockade of the strait during its war with the U.S. and Israel prevented ships from entering the Gulf.
The war has caused Saudi crude exports to slump to about 4 million bpd in the past three months, the data showed, from more than 7 million bpd in February.
OIL SLIPS ON RISING SUPPLY
Global oil prices fell more than $1 a barrel on Friday after edging up on reports of the attack on the cargo ship. Supply pressure is increasing after crude shipments through the strait rose this week to their highest level since the conflict broke out.
Iraq’s SOMO and Qatar issued tenders offering crude, following similar moves by Kuwait and the United Arab Emirates. Iran is also rushing its exports after Washington temporarily lifted sanctions. Two empty VLCCs - Natsumi and Halti - entered the Gulf on Friday to load Iranian oil, shipping data showed.
“Two million barrels a day came back online in three weeks, and the recovery is spread across the region,” Rystad Energy’s MENA research director Aditya Saraswat said in a note, adding that the supply picture is clearly improving.
The consultancy now estimates that shut-in production across the Gulf has fallen to 9.6 million barrels per day (bpd) in mid-June, down from 11.7 million bpd just three weeks ago, and expects a full supply recovery in the region by the end of the year.