Rise in global crude oil shipments across Cape of Good Hope route signals strategic shifts in trade patterns
Date
6/12/2024 5:36:02 AM
(MENAFN) The US energy Information Administration (EIA) reported a significant surge in global crude oil and fuel shipments opting for the Cape of Good Hope route, which connects Asia, the Middle East, and the West, marking a notable increase of 47 percent since the onset of attacks on ships in the Red Sea. The attacks, attributed to Houthi militants in Yemen, prompted vessels to opt for the longer but safer Cape of Good Hope route to circumvent the heightened risks and elevated shipping costs associated with traversing the Red Sea and the Egyptian Suez Canal. Previously, approximately 12 percent of the world's total shipping traffic flowed through the Red Sea and the Suez Canal.
According to data sourced from ship tracking service Vortexa, the EIA revealed that daily shipments of crude oil and refined products via the southern Africa route reached 8.7 million barrels on average during the first five months of 2024, a notable increase from the 5.9 million barrels recorded on average throughout 2023. Notably, the bulk of this surge was attributed to petroleum product shipments.
The report highlighted shifts in crude oil trade patterns, with Saudi Arabia and Iraq redirecting more crude oil exports to Europe via the Cape of Good Hope route instead of the traditional Red Sea and Suez Canal passage, accounting for 15 percent of the total increase. Additionally, refining companies in Asia and the Middle East expanded their exports of refined products to Europe and diverted shipments through southern Africa, contributing to 29 percent of the overall surge.
Furthermore, the EIA underscored the United States' increased involvement in trade via the Cape of Good Hope route, with a notable rise in both imports of crude oil and refined products from the Middle East and Asia and exports of products to Asia. Overall, US trade volumes surged by over a third, equivalent to approximately 600 thousand barrels per day, through this alternative maritime pathway.
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