The Strait of Hormuz is blocked, Saudi Arabia and the UAE urgently reroute through the Red Sea, with at least 25 oil tankers already diverted!

The Strait of Hormuz transit situation is reshaping the global crude oil market.

On Wednesday, according to ship tracking data cited by Bloomberg, Saudi Aramco is working to increase the capacity of the east-west pipeline, while exports from Fujairah in the UAE have surged significantly, with at least 25 oil tankers rerouted around the Red Sea port of Yanbu. The global oil supply landscape faces a short-term restructuring.

Saudi Aramco CEO Amin Nasser stated that the flow through the east-west pipeline to Yanbu “will reach full capacity of 7 million barrels per day within a few days,” and “everything depends on the redeployment of tankers from east to west.” Meanwhile, exports from Fujairah port in the UAE have increased from about 1.1 million barrels per day to approximately 1.6 million barrels.

On Tuesday afternoon, news broke that a U.S. warship escorted an oil tanker through the Strait of Hormuz, causing Brent crude futures to briefly fall to around $81 per barrel. Market concerns about complete channel paralysis eased somewhat, but analysts warn that normal transit order is still unlikely to be restored within this week.

Saudi and UAE Launch Alternative Export Routes

Faced with ongoing disruptions in the Strait of Hormuz, major Gulf oil-producing countries have quickly activated backup export plans. Saudi Aramco is pushing the east-west pipeline capacity toward its designed limit of 7 million barrels per day, transporting crude from the Persian Gulf facilities to the Red Sea port of Yanbu, then exporting via tankers to global markets. Amin Nasser said that as tankers continue to redeploy from east to west, pipeline flow will peak within a few days.

The UAE relies on Fujairah port for a similar strategy. Located in the Gulf of Oman, it can bypass the Strait of Hormuz for direct exports. This month, exports from Fujairah have increased by about 45% compared to recent averages, reaching approximately 1.6 million barrels per day.

Meanwhile, French President Macron held talks Thursday morning with the Italian and Greek Prime Ministers. The leaders agreed on coordinating military supplies to Cyprus and jointly maintaining freedom of navigation in the Red Sea. Europe is seeking to stabilize this critical shipping route through multilateral coordination.

Iran’s Warnings Escalate, Market Tensions Persist

Despite the accelerated deployment of alternative routes, geopolitical uncertainties continue to weigh on the market.

Ali Larijani, Secretary of Iran’s Supreme National Security Council, issued a stern warning, stating that the Strait of Hormuz “must become either a path of peace and prosperity for all or a path of failure and suffering for war profiteers,” implying Iran does not rule out further escalation.

Some vessels still pass through the Strait with transponders turned off, indicating that the transit risk has not been fully eliminated. The conflict has already reduced global oil supply by about 6%, with several oil-producing countries forced to cut production due to tank overflows. Short-term supply pressures remain difficult to fully absorb.

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