The passage through the Strait of Hormuz is reshaping the global oil market.
On Wednesday, Bloomberg cited ship tracking data indicating that Saudi Aramco is fully ramping up the capacity of its East-West pipeline, while exports from Fujairah in the UAE have surged significantly, with at least 25 tankers rerouting to the Saudi Red Sea port of Yanbu, leading to a short-term restructuring of the global oil supply landscape.
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Saudi Aramco CEO Amin Nasser stated that the flow through the East-West pipeline to Yanbu will reach its full capacity of 7 million barrels per day &#34;within days,&#34; and &#34;everything is based on the redeployment of tankers from east to west.&#34; Meanwhile, exports from Fujairah have jumped from about 1.1 million barrels per day to approximately 1.6 million barrels this month.
On Tuesday afternoon, after news emerged that a U.S. warship was escorting tankers through the Strait of Hormuz, Brent crude futures briefly fell to around $81 per barrel, alleviating market concerns about a complete shutdown of the shipping lane. However, analysts warned that the likelihood of normal traffic order being restored within this week remains limited.
<h2>Saudi Arabia and UAE Launch Dual Alternative Export Channels</h2>
In response to the ongoing disruptions in the Strait of Hormuz, major oil-producing countries in the Gulf have quickly initiated backup export plans. Saudi Aramco is pushing the East-West pipeline flow to its design limit of 7 million barrels per day, transporting crude oil from facilities along the Persian Gulf to the Red Sea port of Yanbu, from where it is exported to global markets. Amin Nasser stated that as tankers continue to redeploy from the east to the west, pipeline flow will peak within days.
The UAE is implementing a similar plan relying on the port of Fujairah. Located in the Gulf of Oman, it can bypass Hormuz for direct exports, with this month's export volume increasing by about 45% compared to recent averages, reaching approximately 1.6 million barrels per day.
Meanwhile, French President Macron spoke with the Italian Prime Minister and the Greek Prime Minister on Thursday morning, and the three leaders reached an agreement to coordinate the delivery of military supplies to Cyprus and jointly maintain freedom of navigation in the Red Sea. Europe is seeking to stabilize this critical shipping lane through multilateral coordination.
<h2>Iran's Warnings Escalate, Market Tension Remains</h2>
Despite the accelerated use of alternative channels, geopolitical uncertainties continue to exert pressure on the market.
Ali Larijani, Secretary of Iran's Supreme National Security Council, issued a warning that the Strait of Hormuz &#34;will either become a path of peace and prosperity for all or a path of failure and suffering for war merchants,&#34; using strong language to suggest that Iran does not rule out the possibility of further escalation.
There are still vessels passing through the Strait of Hormuz with their transponders turned off, indicating that the risks of passage have not been eliminated. This conflict has already reduced global oil supply by about 6%, with several oil-producing countries forced to cut production due to full storage tanks, making it difficult to fully digest supply-side pressures in the short term.
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The passage through the Strait of Hormuz is obstructed, prompting Saudi Arabia and the UAE to quickly initiate alternative export plans, with at least 25 oil tankers redirected to the Red Sea port of Yanbu. Saudi Aramco plans to increase the flow through the East-West pipeline to 7 million barrels per day, and the export volume from the UAE's Fujairah port has also significantly increased to 1.6 million barrels per day. Although U.S. warships escorting tankers through the Strait of Hormuz have alleviated market concerns, geopolitical uncertainties continue to exert pressure on the market

- The Strait of Hormuz's shipping situation is reshaping the global oil market, with Saudi Aramco increasing its east-west pipeline capacity to 7 million barrels per day.  
- Meanwhile, oil exports from the UAE's Fujairah port have surged by 45%, reaching approximately 1.6 million barrels daily as alternative routes are activated in response to disruptions.  
- Despite the establishment of these alternative channels, geopolitical uncertainties persist, with Iran warning of potential escalation, and the ongoing conflict has currently reduced global oil supply by about 6%.

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The Strait of Hormuz is blocked, and Saudi Arabia and the UAE have urgently rerouted to the Red Sea, with at least 25 oil tankers changing course!