Saudi Oil Tanker Insurance Costs Triple Amid Red Sea Tensions
According to the International Desk of Webangah News Agency, Reuters, citing informed sources, has reported a threefold increase in insurance costs for oil tankers carrying crude from Saudi Arabia‘s Yanbu port over the past few weeks.
The surge in war risk insurance premiums in the Red Sea poses a new challenge to Saudi Arabia’s strategy of developing an alternative oil export route. Reuters, relying on sources, satellite imagery, and shipping data, also indicated that oil loading operations at Yanbu’s main port have not yet resumed.
Four sources informed Reuters that the declared war risk insurance for oil tankers associated with Saudi Arabia docking at Yanbu has risen to approximately 3% of the vessel’s value. The report further suggested that war risk insurance for tankers connected to Saudi ports south of Yanbu could escalate to 7% of the vessel’s value.
The head of Hydmar Maritime, speaking to Reuters, stated, “If you have any association with Saudi Arabia, you will face difficulties.” He elaborated, “Any tanker docking at Yanbu will have an association with Saudi Arabia and consequently be at risk of attack.” The Hydmar Maritime chief also confirmed that his company is avoiding Saudi ports.
Reuters reported that the cost of war risk insurance for a voyage from Yanbu could reach approximately $3 million, with the cost for voyages from southern Saudi ports or transiting the Strait of Hormuz potentially increasing to around $7 million.
