Saudi Arabia is yet again being forced to overhaul how its oil gets to customers around the world, as Yemen’s Houthis make it harder for Riyadh to use a backup route that’s been vital to the global economy since the Iran war started. The top exporter is sending tankers thousands of miles all the way around Africa. Millions of barrels of the kingdom’s crude are being shuttled north across the Red Sea, avoiding a narrow strait near Yemen at the southern end of the Red Sea.
China, meanwhile, is being offered Middle East shipments for collection just outside the Persian Gulf. Saudi Arabia’s ability to switch crude exports to its west-coast facilities has been critical in blunting an oil price surge and shielded economies from an inflation spike as Iran effectively shut the Strait of Hormuz. Now, with Yanbu also under threat from the Iran-backed Houthis, the kingdom and its customers are having to make new arrangements.
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