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Oil tanker bottleneck builds at Saudi ports after attacks

Reuters , Monday 16 Sep 2019
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At least 11 supertankers are waiting to load oil cargoes from Saudi Arabian ports after an attack on the country's oil facilities at the weekend halved the kingdom's production, ship tracking data showed on Monday.

Each supertanker, or very large crude carrier (VLCC), can carry up to 2 million barrels of oil, and growing disruption to loading operations has caused a build-up of vessels.

Data from analytics company Refinitiv showed at least 11 supertankers waiting to load from the ports of Ras Tanura and Juaymah in the Gulf, compared with five vessels on Thursday.

"The disruption in loading operations over the weekend has also resulted in a pile up of VLCCs at the waiting anchorage," Refinitiv said.

Shipping intelligence platform MarineTraffic showed the overall number of tankers that departed from Saudi Arabian ports between Sept 14-16 was 56 vessels, compared with 58 in the same period in August.

The number of vessels arriving at Saudi ports dropped to 59 tankers in the past two days versus 68 in the same period in August, MarineTraffic data showed.

"The oil tanker industry was just thrown a major curveball - which should see an initial loss of demand for roughly 2.5 VLCCs per day," Greg Lewis, managing director, shipping and energy, with investment bank and brokerage BTIG, said in a note on Monday.

"The partial loss of Saudi production should drive major disruptions throughout the tanker industry."

The attack on Saudi Arabia that shut 5% of global crude output triggered the biggest surge in oil prices since 1991, after U.S. officials blamed Iran and President Donald Trump said Washington was "locked and loaded" to retaliate.

The Iran-aligned Houthi movement that controls Yemen's capital claimed responsibility for the attack, which damaged the world's biggest crude oil processing plant. Iran denied blame and said it was ready for "full-fledged war".

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