Detailed numbers at the link. Also pricing that confirms what Hohum was posting last week.
Instead, it [UAE] established what I describe as the “Hormuz Shuttle”. It started early. Already back in May, it placed eleven hulls - mostly VLCCs, owned, leased & operated by ADNOC - to get the risky job done of shuttling crude out of the Persian trap via the Oman Lane into the Gulf of Oman, unloading it via Ship-to-Ship (STS) transfer and then re-entering the Persian trap to repeat the trade.
Fast forward to September and not only has ADNOC become very good at the Hormuz Shuttle, Aramco and Kuwait have learned from the UAE and copied the model. By now, we have some 116 hulls active in the Shuttle trade around the Strait of Hormuz, most of them using the Oman Lane, hugging the coast of Oman…
As importantly, ADNOC has overcapacity for the trade. That means it can provide the Shuttle service for Iraq too, of course at a nice fee. How much? At this point, it costs about $212 per metric tonne, or roughly $28-30/bbl depending on the grade, to ship crude out of the Persian trap. In other words, for a ten to fifteen day trip with 2mn bbl of crude loaded on a VLCC, a customer pays some $58m. That is a lot, ladies and gentlemen. And it is why a brand-new VLCC costs about $220m to buy today, while ordering a newbuild in a Korean shipyard costs some $132m according to my Bloomberg data. The value is in the here and now, not in delivery by 2030…
Frontline (FRO) mgmt suggested two somewhat newer VLCC (built 2017) sold to ADNOC were going to be used for other purposes, likely shuttle stuff. Last week, a shipping broker reported ADNOC had purchased a slightly older VLCC (built 2013) for an even higher price $177M
The link mentioned that refined products are higher priced than the oil supply would suggest because refineries are damaged or shut-in (Russia and the Middle East).
Middle East crude oil exports back at prewar levels, analysts say
Goldman Sachs estimates that crude exports from Persian Gulf producers reached 19 million barrels a day over the past week through Monday. Crude accounted for nearly 90% of the recovery…
Iran’s ability to choke off oil flowing through Hormuz is breaking down, and the country has been unable to move its own crude…
With flows through Saudi Arabia’s East-West pipeline recently restored, the 10-day average of crude exports from the Middle East has rebounded to 17.5 million barrels a day, or 98% of prewar levels, J.P. Morgan analysts said.
