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Breaking News:

OPEC Lifts Production in February

Asia-Bound U.S. LNG Cargoes Avoid The Red Sea Route

Several cargoes of LNG loaded in recent days at U.S. export facilities and bound for Asia have changed course shortly after departing to avoid crossing the Red Sea, which has become theater of daily attacks on commercial vessels by the Iran-aligned Houthis from Yemen.

Several vessels have indicated they would not transit the Suez Canal and the Red Sea and will travel around the southern tip of Africa instead, Bloomberg’s ship-tracking data showed on Friday.  

The African route adds weeks to the travel time for the cargoes to reach Asia—the biggest importer of LNG – from the U.S., the world’s top LNG exporter.

In a sign that a growing number of energy cargoes are being diverted away from the Suez Canal/Red Sea route, the Vivit Americas LNG ship, which loaded at the Cove Point plant in Maryland on December 16, diverted to Africa after initially pointing to a course via the Red Sea, according to Bloomberg’s data. The trip around Africa will take longer and the cargo is now expected to arrive in Japan on January 25. The Prism Courage, which loaded from Freeport LNG plant in Texas on December 16 with a destination South Korea, is also avoiding the Red Sea, per Bloomberg’s data.  

The Suez Canal and the Bab el-Mandeb Strait are critical chokepoints for international oil and natural gas flows. Total oil shipments via the Suez Canal, the SUMED pipeline, and the Strait accounted for 12% of total seaborne-traded oil in the first half of 2023, and liquefied natural gas (LNG) shipments accounted for about 8% of worldwide LNG trade, the U.S. Energy Information Administration (EIA) says.

Oil and fuel tankers passing through the Bab el-Mandeb strait in the Red Sea have declined in numbers significantly following the string of vessel attacks from the Yemeni Houthis.

According to Bloomberg tracking data, since the start of this week only 30 tankers have passed through the chokepoint, which is one of the busiest globally. That’s a 40% decline from the average for the previous three weeks, the news outlet noted.

By Charles Kennedy for Oilprice.com


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