Key Saudi export hub Yanbu sees highest activity since Houthi threats

A growing number of vessels are now transiting the Bab el-Mandeb Strait with their tracking signals turned off, marking what appears to be the busiest day at Saudi Arabia's key crude export port of Yanbu since Yemen's Houthi group threatened to disrupt shipping in the region. After the Middle East conflict disrupted traffic through the Strait of Hormuz, Yanbu became a vital hub for Saudi Arabia to maintain large-scale crude exports. The kingdom pipes millions of barrels of oil daily to the Red Sea coast, bypassing the Strait of Hormuz to deliver crude to global customers.

Satellite imagery showed five Very Large Crude Carriers (VLCCs) docked at Yanbu's oil loading terminal on Saturday, each capable of carrying roughly 2 million barrels of crude. This likely makes it the most active day since Iran-backed Houthi forces imposed a blockade on Saudi ports two weeks ago.

Covert crossings increase as some tankers risk detection

According to data from shipping analytics firms Vortexa and Kpler, the Greek-owned Suezmax tanker "Lesvos" and the Indian-flagged VLCC "Desh Vaibhav" crossed the Bab el-Mandeb Strait over the weekend with their Automatic Identification Systems (AIS) turned off. Both vessels were loaded with Saudi crude from Yanbu. Ship tracking data shows that after previously broadcasting signals near the Red Sea port, both tankers have now reappeared off the coast of Oman.

Some tankers, including those transporting Russian crude, continue to openly transit the strait. Two additional Saudi crude cargoes, one Algerian crude shipment, and one Sudanese cargo have also crossed the strait with tracking signals disabled. However, Houthi threats have forced some Saudi tankers to take longer routes around Africa, while Saudi Arabia has also diverted some oil shipments originally destined for Asia from the Red Sea to Egypt's Mediterranean port of Sidi Kerir.

Persian Gulf crude exports remain high despite risks

Crude continues to leave the Persian Gulf, with most tankers relying on turning off their AIS signals. Ship tracking data shows that over 8.4 million barrels of crude left the Persian Gulf on Friday, marking one of the highest single-day export levels since the Middle East conflict erupted at the end of February.

Meanwhile, U.S. President Donald Trump canceled a large-scale military attack on Iran and stated that negotiations to reopen the Strait of Hormuz are about to resume. OPEC+ has also approved a small production increase of about 188,000 barrels per day starting in September, completing the gradual unwinding of voluntary production cuts from last year. The combination of easing geopolitical tensions and expectations of normalized supply has sharply cooled panic in the crude oil market. As of press time, Brent crude futures fell 4.48% to $83.99 per barrel, while WTI crude futures dropped 5.57% to $79.95 per barrel.

Strait of Hormuz remains risky despite peace talks

Despite emerging signs of peace talks, the risk of navigating the Strait of Hormuz has not dissipated. The UK Maritime Trade Operations office reported on Sunday that a tanker near Oman experienced a close-proximity explosion. This follows an incident last week where a liquefied natural gas vessel was struck by a flying object, highlighting that this vital chokepoint, which normally carries about one-fifth of the world's crude oil and liquefied natural gas, remains highly uncertain. On Monday, observable shipping activity through the key strait was very limited.

Gulf oil producers are actively seeking alternative export routes. Iraq's Oil Ministry said Turkey and Iraq have agreed to extend a deal for an inactive oil pipeline by one year. The pipeline could export up to 750,000 barrels of crude per day. In Kazakhstan, the Energy Ministry announced that the Caspian Pipeline Consortium resumed normal operations on August 1, with crude processing volumes maintained at 100,000 tonnes per day. The impact of a temporary suspension has gradually faded. However, actual export volumes still depend on whether tankers are willing to enter Black Sea waters near facilities at risk of attack, as a series of strikes on tankers loading nearby has severely disrupted this key export route for Kazakh crude.