Breaking news! Saudi Arabia bypasses the Strait of Hormuz with 7 million barrels of oil daily

【Introduction】Saudi Arabia Bypasses Hormuz with 7 Million Barrels of Oil Daily

Hello everyone, here’s a brief update on oil transportation in the Middle East.

Saudi Arabia’s pipeline bypassing the Strait of Hormuz is operating at full capacity of 7 million barrels per day.

It is reported that Saudi Arabia’s crucial east-west pipeline—used to bypass the Strait of Hormuz—is currently operating at full capacity of 7 million barrels per day.

This technological milestone marks the success of the country’s long-term emergency plan: ensuring that oil can continue to be exported despite the effective closure of major export routes. A large number of tankers have been redirected to the Red Sea port of Yanbu to load crude oil, providing a critical “lifeline” for global supply.

According to sources familiar with the Saudi oil industry, crude oil exports via Yanbu have reached approximately 5 million barrels per day, while Saudi Arabia also exports 700,000 to 900,000 barrels of refined oil daily. Of the 7 million barrels transported daily through this pipeline, about 2 million barrels go to domestic refineries in Saudi Arabia.

However, the Yanbu route can only partially fill the supply gap caused by the closure of the Strait of Hormuz—before the outbreak of war, the Strait was responsible for the transportation of about 15 million barrels of crude oil daily. The existence of this “bypass” is also one of the key reasons why oil prices have not surged to levels seen during previous supply shock crises.

With the Yemeni Houthi rebels announcing their involvement in the war, there are market concerns that the Red Sea may become a new frontline of conflict. Although the Houthis have not explicitly stated they would attack tankers passing through the Red Sea and Bab el-Mandeb Strait, they have previously threatened shipping in the region with drones and missiles.

As the world’s “last supplier,” Saudi Arabia has long been known for its stability and reliability, and has prepared for the worst-case scenario of the closure of the Strait of Hormuz for decades. Within hours of the first strikes by the U.S. and Israel against Iran, Saudi Arabia quickly activated its emergency plan and continued to enhance its east-west transportation capacity.

This pipeline spans the Arabian Peninsula, extending over 1,000 kilometers from the country’s large oil fields in the east directly to the industrial port city of Yanbu in the west. Its construction dates back to the 1980s during the Iran-Iraq War, when tankers in the Strait of Hormuz were attacked, but the scale of those incidents pales in comparison to the “near closure” caused by the current conflict.

Divergence in the Gulf Markets

As the conflict in the Middle East continues to escalate, the stock markets of Gulf countries are showing clear divergence. Volatile energy prices and increasing geopolitical turmoil have kept the markets in a state of fluctuation.

Since March 1, the Oman stock index has risen by 9.3%, and the Saudi Tadawul index is up 5.8%, leading the region; meanwhile, the Dubai DFM General Index has plummeted nearly 16%, Qatar is down 4%, and the Bahrain BAX index has fallen by 7.2%.

Analysts state that the Saudi stock market is highly correlated with energy prices, with rising oil prices directly boosting its performance; conversely, Oman benefits from an influx of capital seeking refuge. In contrast, they point out that the UAE market, which is more sensitive to real estate and broader geopolitical risks, has been the most affected market in this round of shocks.

Analysts indicate that the current high oil prices are generally favorable for the Saudi market—this market is dominated by a few large energy companies. They specifically mentioned that Saudi Aramco has the capability to export oil while bypassing the Strait of Hormuz—this maritime route has become a key risk point in the current conflict—and can transport crude oil to the Mediterranean region via pipeline. “Oil prices staying above $80 per barrel is overall beneficial for Saudi Arabia and energy companies in the region.”

(Source: China Fund News)