Saudi shipping giant spares no expense to grab ships! Paying astronomical freight rates, opening a new route in the Red Sea to transport crude oil.

Saudi Arabia's largest oil shipping company has been booking tankers at sky-high rates as a large fleet of vessels heads to the Red Sea to load the country's crude oil as an alternative plan after the blockade of the Strait of Hormuz. According to ship leasing lists, the Saudi National Shipping Company (Bahri) has hired at least 6 very large crude carriers (VLCCs) in recent days to transport oil from the western port of Yanbu. A ship broker and two ship owners have indicated that they believe the company's procurement scale is even larger than this, and more deals may be reached in the coming days. Due to interruptions in exports through the Strait of Hormuz caused by the Middle East conflict, Saudi Arabia has been increasing its supply redirection to the Red Sea through pipelines. The disruption of this waterway, which usually handles one-fifth of global supply, has led to multiple spikes in crude oil prices to over $100 per barrel this week, with key tanker rates reaching historic highs. Bahri stated that the company is closely monitoring the development of the regional situation and continues to manage its operations in accordance with established safety and operating procedures, also adding that they cannot comment on commercial transactions. Ship tracking data shows a fleet of tankers stretching from Singapore to the Red Sea heading to Yanbu to collect Saudi crude oil. The fleet consists of at least 24 vessels, although it is currently unclear the identities of all these vessels' charterers. Currently, at least 24 super-tankers are on their way to Yanbu. Many of Bahri's bookings are priced at the industry standard 450 points of the Worldscale tanker freight index, equivalent to over $450,000 per day. Prior to the outbreak of the war, the industry benchmark rate had never exceeded $300,000 per day. The head of Saudi Aramco stated this week that he expects the pipeline stretching across the country, approximately 1200 kilometers (746 miles) long, to reach full capacity within a few days, marking the acceleration phase of Saudi Arabia's primary alternative plan to the Strait of Hormuz. The pipeline has a daily capacity of 7 million barrels of crude oil, but around 2 million barrels of capacity will be allocated to supply Saudi refineries domestically. This means that the Red Sea redirection plan will handle mostbut not allof the country's regular exports. Ship tracking data shows that Bahri had also chartered at least 5 ships before the outbreak of the Middle East conflict, with some of these vessels now seemingly en route to Yanbu.