Andre Klynsmith

Mining and Commodities

Twenty Million Barrels Back Through the Strait: Saudi Arabia Reverses Its Own Workaround

Saudi Aramco has sold about 20 million barrels of crude to Asian refiners this week for pick-up just outside the Strait of Hormuz, pivoting back toward the waterway it had spent months avoiding after its East-West pipeline was shut.

Mining and Commodities

17 September 2026 • 3 min read

The barrels still have to cross Hormuz. What has changed is who owns the crossing. By selling on a ship-to-ship basis from the Gulf of Oman, Aramco keeps the transit risk on its own side of the trade — a reminder that chokepoint risk does not disappear when it stops appearing in the headline.

The trade Aramco just did

According to traders familiar with the matter who spoke to Bloomberg, the roughly 20 million barrels sold this week can be lifted this month and next from just outside Hormuz. The buyers included Chinese state-owned and independent processors along with other importers in East Asia. The cargoes are for loading from the Gulf of Oman on a ship-to-ship basis over September and October. Aramco declined to comment.

The structure is the point. Because the buyer takes delivery outside the strait, the buyer is not responsible for that portion of the voyage. The crude still transits Hormuz; the exposure sits with the seller and the vessels it arranges.

The western outlet is the part that broke

The East-West pipeline was the primary means by which Saudi Arabia had been routing crude around the Iran war turmoil in Hormuz, carrying barrels across the country to its Red Sea coast. It was shut last week after attacks, and there has been no official restart date.

The knock-on is already visible at the western end. Following the halt, Aramco has delayed deliveries from Yanbu — the pipeline’s western terminus — to some European customers and at least one East Asian refiner. The extent of the delays was not immediately clear. The rising volume of prompt spot sales via the Persian Gulf suggests Riyadh is now steering back toward its traditional route even while the risk to shipping there persists.

Why an oil-trade structure matters to a haulier

Southern Africa does not process much crude; it buys refined product. So the signal to read here is not the barrel count but the direction of travel. The Red Sea outlet that was absorbing pressure is now degraded, delivery schedules out of Yanbu are slipping, and the world’s largest exporter is choosing to accept transit risk rather than wait for the bypass. None of that points toward cheaper or more predictable product freight in the fourth quarter.

The re-papering of risk is also worth borrowing as a commercial idea. Aramco did not remove the hazard from the voyage; it moved the hazard to the party better able to carry it, and priced accordingly. That is exactly the question an operator should be asking about its own fuel and freight contracts: not whether the risk exists, but whose balance sheet it currently sits on.

About the Author
	Andre Klynsmith Entrepreneur & Technology Enthusiast Andre's expertise spans technology, blockchain, transport, and logistics — with a passion for innovation and driving positive change across industries. info@laaimylorrie.com | laaimylorrie.com