Since the middle of last week, Saudi Arabia has sold nearly 100 million barrels of crude oil to Asian buyers via the Strait of Hormuz. This development has occurred following the shutdown of the East-West pipeline, prompting the country to turn to the Strait of Hormuz, which it intended to avoid.
Details of Crude Oil Sales
According to information from trade sources, this sale is for delivery in October and November and is equivalent to approximately one day's total global oil demand. By increasing its crude oil sales through the Strait of Hormuz, Saudi Arabia is clearly trying to meet the growing demand in Asian markets. Buyers include Chinese refineries, state-owned and private refineries in India, South Korea, and Japan.
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Impact on Oil Prices and Market
This sale significantly increases the flow of Saudi crude oil from the Hormuz route to Asia and is expected to affect oil prices. Although Saudi Arabia has recently resumed part of the East-West pipeline operations, a full return of oil flows, which reach about 4 million barrels per day, is likely to take weeks.
Meanwhile, the increase in Saudi crude oil sales through the Strait of Hormuz makes it possible to meet part of Asia's needs while Red Sea exports are returning to normal. The increased volume of exports from the Strait of Hormuz could alleviate concerns about supply shortages and rising oil prices.
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