Saudi Oil Reroutes Around Africa as Hormuz, Bab el-Mandeb Disruptions Add $2.5M Per Voyage

Saudi Arabia is redirecting oil exports through Egypt's Suez Canal for the first time as a primary route in decades, after attacks disrupted both the Hormuz and Bab el-Mandeb straits — a shift that could affect near-term supply logistics and increase transportation costs.

The route disruption, by the numbers (per Kpler and LSEG shipping data):

→ Direct route via Bab el-Mandeb (Yanbu, Saudi Arabia to Taiwan): 19 days

→ Alternative route via Suez Canal, Mediterranean, Gibraltar, and Cape of Good Hope: 48 days — nearly a full month longer

→ Fuel costs alone: rise to approximately $2.87 million from $1.26 million per voyage, based on Reuters calculations using LSEG data

→ Additional Suez Canal transit fees: approximately $1 million per crossing

→ Combined added cost per voyage: roughly $2.5 million, plus a month of extended transit time

Operational background: Saudi Arabia had already rerouted most Gulf exports to the Red Sea in February following U.S.-Iran conflict disruptions to Hormuz. This week's Houthi attacks on Red Sea shipping have now made that workaround unsafe, forcing the shift to Suez.

Logistical considerations: Per Energy Aspects, large tankers must transit Suez only half-loaded due to draft restrictions, topping up in the Mediterranean. Saudi Arabia can partially offset this via the Sumed pipeline — a 320km link connecting the Red Sea to the Mediterranean with capacity of up to 2.5 million barrels per day, against total Saudi exports of roughly 7 million bpd.

Market implications: Extended transit times and elevated freight costs could widen the delivered-price gap for Asia-bound Saudi crude, potentially supporting tanker freight rates and adding a risk premium to Brent-Dubai spreads. Market participants are likely to monitor Sumed pipeline utilization and Suez Canal transit volumes to assess how shipping patterns evolve if disruptions in the Red Sea and Strait of Hormuz continue.

Source: Reuters reporting (Enes Tunagur, Shadia Nasralla), July 24, 2026; Kpler and LSEG shipping data; Energy Aspects analysis.