Supertankers Turn From Gulf Oil Transfer Hub Amid Iran’s Attacks

Empty supertankers are turning away because approaching Fujairah and nearby waters has become increasingly dangerous. The article reports near-daily attacks around the Strait of Hormuz, including some near Fujairah itself. Operators appear less willing to position valuable vessels in a conflict zone before they collect oil.

Fujairah is an interim destination for ships that may collect cargo through ship-to-ship transfers in the Gulf of Oman or continue toward the Persian Gulf. Large crude carriers can wait outside the strait while smaller shuttle tankers make the riskier passage. If the large ships do not arrive, that workaround loses capacity.

The pullback is notable because tanker earnings are unusually high. A global tanker shortage has pushed costs to extraordinary levels, with a US-to-China voyage costing more than launching a rocket into space. Safety concerns are therefore outweighing powerful financial incentives for some operators.

Fujairah functions as an interim destination and transfer hub for tankers moving oil around the Strait of Hormuz. Ships signaling Fujairah may ultimately sail to the Gulf of Oman, where they can collect cargo through ship-to-ship transfers, or continue onward into the Persian Gulf.

The arrangement separates the largest tankers from the most dangerous part of the journey. A large crude carrier can wait off Fujairah or in Omani waters outside Hormuz. Shuttle tankers then make the riskier transit through the strait, bring out crude, and transfer it to the waiting carrier for onward shipment.

This makes traffic heading toward Fujairah a useful indicator of tanker operators’ willingness to approach the waterway. The system has helped Persian Gulf oil exports recover to near prewar levels. Its effectiveness depends on enough receiving tankers being available.

Tanker-tracking data compiled by Bloomberg shows at least 10 very large crude carriers, or VLCCs, have stopped or reversed course near Fujairah. Several Suezmax vessels have also changed course. The report focuses on empty ships approaching the port and nearby waters.

A VLCC is a very large crude carrier built to transport huge quantities of unrefined oil. A Suezmax is another large tanker class, sized around the limits traditionally associated with the Suez Canal. The article does not give exact capacities for the vessels involved, but both types are major crude-oil carriers.

Their retreat matters because these ships are potential receiving tankers. They can wait outside Hormuz and accept crude from shuttle tankers that make the dangerous crossing. If fewer large vessels enter the region, the transfer system may move less oil and keep shuttle tankers occupied longer.

Ship-to-ship transfer creates a workaround around attacks in the Strait of Hormuz. Instead of one large tanker carrying out the entire journey, a receiving tanker waits in the Gulf of Oman, off Fujairah, or in other waters outside the strait. A shuttle tanker handles the riskier crossing.

The shuttle tanker enters the Persian Gulf, loads crude, and sails back through Hormuz. Outside the strait, it transfers that crude to the waiting large carrier. The receiving vessel can then continue toward buyers. This divides the voyage and limits how many large carriers must enter the most exposed area.

The method has helped Persian Gulf oil exports recover to near prewar levels. However, it depends on a steady supply of receiving tankers. If empty VLCCs and Suezmax vessels keep turning away, shuttle tankers may remain tied up longer, reducing the system’s ability to move crude.

The main risk is a bottleneck in the final stage of the transfer system. Empty VLCCs and Suezmax vessels are needed outside Hormuz to receive crude from shuttle tankers. If too few enter the region, there are fewer ships ready to accept oil and carry it onward to buyers.

For example, a shuttle tanker could cross the strait, collect crude, and return with its cargo, but find no receiving vessel waiting outside. It would then remain occupied for longer. That reduces the number of shuttle voyages possible when tanker availability is already tight.

The article warns that this could slow crude flows through the waterway. The workaround helped exports recover to near prewar levels, but it is not independent of market capacity. Continued attacks and a retreat by empty large tankers could therefore make Persian Gulf exports harder to sustain.

The Strait of Hormuz matters because it is the risky passage connecting Persian Gulf oil movements with tankers waiting outside the waterway. The article describes it as central to a transfer hub supporting wartime oil shipments and says attacks there threaten the sustainability of flows.

Its importance is clear in the workaround now being used. Shuttle tankers cross the strait to bring crude out, while larger carriers wait near Fujairah or in Omani waters. Those carriers receive the oil and transport it onward. A problem in the strait therefore affects both the crossing tankers and the receiving vessels around it.

The article reports near-daily attacks and a retreat by some empty tankers. If that pattern continues, fewer ships may be willing or able to support transfers. Persian Gulf exports could then slow, even when crude is available and buyers still want shipments.

Crude oil is petroleum in its natural, unrefined form. A supertanker is a very large tanker designed to carry large crude-oil cargoes. A tanker shortage means demand for these ships exceeds the available supply. These three ideas describe the cargo, the transport, and the capacity constraint.

In this article, empty VLCCs and Suezmax vessels are needed as receiving tankers. Shuttle tankers cross the Strait of Hormuz, collect crude, and transfer it outside the strait. The large carrier then takes the oil onward. If receiving ships are scarce, each shuttle may wait longer before unloading.

That is why ship availability affects oil flows even when crude exists. The article says a global tanker shortage has pushed shipping costs to extraordinary levels. Attacks are now causing some empty tankers to retreat, potentially tightening capacity further and making deliveries to buyers more difficult.