Saudi Arabia boosts SUMED pipeline oil flows as Red Sea risks rise
Saudi crude moving through Egypt’s SUMED pipeline has surged, offering a route away from Bab el-Mandeb but adding costs for Asia-bound cargoes.
By Maya Okafor · Markets Writer
· 3 min read
Saudi Arabia SUMED pipeline flows have risen sharply in August as the kingdom shifts more crude north through Egypt toward the Mediterranean, according to shipping-data firms cited by CNBC and Reuters. The move gives Saudi Aramco another way to reach buyers while avoiding the southern Red Sea passage near Bab el-Mandeb, where Houthi threats have increased risks for tankers.
For investors watching oil supply, the rerouting shows how security disruptions can reshape the physical market even when barrels are still being produced. Longer voyages, higher insurance costs and uncertainty over shipping data can change where crude is sold and how much it costs to deliver.
Kpler data cited by CNBC put exports from Egypt’s Mediterranean port of Sidi Kerir at about 2.3 million barrels a day in August, up from roughly 1 million barrels a day in July. Kpler’s Matt Smith said most of those shipments were Saudi crude.
A separate Reuters report republished by MarineLink cited Vortexa data showing crude and condensate loadings at Sidi Kerir averaged 2.17 million barrels a day in the preceding week, about 50% above the prior week. Vortexa analyst George Morris said about 90% of that volume was Saudi crude. The differing figures cover different measurement periods and providers, rather than official Saudi export data.
How does Saudi Arabia use the SUMED pipeline?
Egypt’s SUMED pipeline links Ain Sokhna on the Red Sea with Sidi Kerir on the Mediterranean. CNBC reported that fully laden supertankers cannot pass fully loaded through the Suez Canal. Under the arrangement described by Kpler’s Smith, a tanker discharges part of its Saudi cargo into the pipeline at Ain Sokhna, passes through the canal, then takes the cargo back aboard at Sidi Kerir.
The route is a contingency, not a full escape from Red Sea security risks. Saudi crude must still travel north through the Red Sea to reach Egypt, but it avoids sailing south through Bab el-Mandeb after loading from Saudi Arabia’s Red Sea coast. It is also separate from Saudi Arabia’s East-West pipeline, which carries crude within the kingdom from its eastern producing region to Yanbu on the Red Sea.
Aramco Chief Executive Amin Nasser said on the company’s Aug. 4 earnings call that the company had multiple access routes, including pathways to the Mediterranean through SUMED and the Suez Canal, CNBC reported.
Why does the rerouting matter for oil buyers?
The Mediterranean option appears more practical for customers in the U.S. and Europe. Smith told CNBC that much of the Sidi Kerir flow was headed to those markets rather than Asia. For cargoes that still need to reach Saudi Arabia’s usual Asian customers, the route around Africa adds about 25 days compared with a voyage through Bab el-Mandeb, according to Nasser’s remarks cited by CNBC.
Assessing the disruption at Yanbu remains difficult. Reuters reported that tankers have switched off Automatic Identification System, or AIS, tracking signals in the high-risk area. For the week beginning Aug. 3, Vortexa estimated Yanbu loadings at 2.38 million barrels a day, Kpler put them at 1.78 million, and AXSMarine estimated 850,000 barrels a day.
The northern route also retains risk. CNBC reported that drones struck two liquefied natural gas ships at Egypt’s Damietta port on July 30; no party had claimed responsibility at the time of its report.
This story draws on original reporting from CNBC.
