Middle East conflict: Red Sea crossings down by further 50% as disruption spreads, says Clarksons

The number of vessels transiting the Bab El Mandeb (heading to / from the Red Sea) averaged 31 vessels per day across 25-26thJuly, down by ~50% versus the Q2 average in tonnage terms, reports Clarksons Research, the data and analytics arm of the ClarksonsGroup.

The number of VLCCs crossing the Bab El Mandeb has declined, averaging 1 per day over the past week, down from an average of 3 per day across Q2.

Crossings through the Strait of Hormuz remain at low levels, with 13 transits per day across the weekend, down 90% versus pre-conflict levels, while transits in tonnage terms are down >95%.

VLCC crossings through the Strait of Hormuz remain very limited, with 6 transits reported over the past week down ~95% versus ‘typical’ levels.

The flow of energy out of the Gulf has been very constrained in recent days, with ~1m bpd of crude leaving the Gulf in the past week, down from 10m bpd in early July and 15m bpd pre-conflict while no LNG carriers / VLGCs appear to have transited the Strait in over 10 days.

‘Energy’ shipping markets remain very elevated, with VLCC earnings firming 13% last week to $145,000/day while supportive arbitrage dynamics saw VLGC spot earnings rise 24% w-o-w to $172,000/day (now just ~10% below May’s record high).

An extended avoidance of Bab El Mandeb may increase tanker voyage distances as flows via Yanbu (exported 3.8m bpd past week, +3m bpd vs normal) are re-routed (e.g. Yanbu to China via Suez Canal & Cape of Good Hope is ~15,000 nm, x2 the current distance via Gulf of Aden (6,700 nm)).

Longer-term planning of infrastructure investment to reduce future reliance on Hormuz continues; export capacity from bypass pipelines could rise from 8m bpd today to 17m bpd if all projects are built with these developments often involving longer shipping distances.