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Tanker owners are rerouting very large crude carriers through the Suez Canal to avoid Houthi attacks in the Red Sea, adding days and costs to voyages that once moved freely through the Bab el-Mandeb strait.
Since the Houthis declared a blockade of Saudi Arabian ports in July, they have targeted Saudi-owned tankers as far north as the Red Sea loading port of Yanbu and in the Gulf of Aden. The threat now includes any vessel that has called at a Saudi port, regardless of ownership.
Shipments rerouted, voyages lengthened
Saudi Arabia has shifted crude oil exports to its east-west pipeline due to limited traffic through the Strait of Hormuz. Loadings at Yanbu have increased fourfold since late February, when tensions between the U.S. and Iran escalated.
DHT Holdings CEO Svein Moxnes Harfjeld said during a second-quarter earnings call that the company’s VLCCs previously loaded at Yanbu and exited the Red Sea via the Bab el-Mandeb. That route is no longer safe. He explained that ships now typically exit through the Suez Canal, adding significant distance to voyages.
Most VLCC loadings are now directed northwest. To transit the Suez Canal, ships must offload roughly half their cargo at Ain Sukhna, where it moves via the Sumed pipeline to the Mediterranean port of Sidi Kerir. Some tankers shuttle between Yanbu and Ain Sukhna, while others load directly at Sidi Kerir for trips to Europe or Asia.
A DHT time-chartered vessel is involved in that shuttle business, Harfjeld said. The changes are reducing fleet efficiency and tightening the market. One estimate suggests shipping crude from Yanbu to South Korea via the Mediterranean now takes 54 days instead of 24.
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Rates rise as capacity tightens
For the third quarter, DHT has booked 79% of its VLCC fleet’s spot days at an average rate of $152,700 per day. The disruptions are pushing rates higher, though the increase isn’t solely due to the Red Sea situation.
The rerouting is reshaping trade flows. Some Atlantic-basin tankers now load directly at Sidi Kerir, avoiding the Red Sea entirely. If the Houthi threat continues, this shift could pull more cargo away from traditional Middle Eastern routes.
The industry’s future depends on whether the Houthis expand their targets beyond Saudi-linked vessels. If they do, the detours could become permanent, locking in higher costs and longer transit times. For now, companies are adapting, but the adjustments remain challenging.
Harfjeld stated, “All of this is creating disruption, reducing fleet efficiency and tightening the market.”
The situation has also affected shipping reliability, as carriers adjust to new risks and delays.
