Israel is being forced to divert crude oil imports from its main Mediterranean terminal due to the escalating Gaza conflict, with Bloomberg reporting that an oil tanker is currently heading toward the country's Red Sea port to avoid becoming a target in the conflict.
A 900-foot vessel carrying over 1 million barrels of crude oil from Azerbaijan is being masked as an import intended to dock in Aqaba, Jordan, while its true destination is the Israeli Paz Oil refinery, which will take delivery at Eilat on the Red Sea coast, according to Bloomberg.
The Eilat port on the Red Sea is not typically used for Israeli crude oil imports, and the shift represents concerns that imports could be targeted in the conflict with Hamas.
While Reuters reported earlier on October 9 that Israel's main Mediterranean port, Askhelon, had been closed indefinitely, Bloomberg sources say it remains "officially" open. However, in reality, Bloomberg cited international insurer UK P&I Club as saying that in reality the port is "practically closed and vessels are required to arrange their arrival/entrance to the port with the navy".
Ashkelon is precariously situated only about 6 miles from the Gaza Strip.
Two other ports, Haifa and Ashdod ports, reportedly remain open.
The reported redirection of oil cargo to a rarely used Red Sea port follows Iran's call earlier this week for Islamic countries to impose an oil embargo on Israel.
While that call resulted in a brief oil price rally, an OPEC statement to the effect that there are no plans to implement such an embargo cooled markets somewhat.
On Tuesday, the secretary-general of the Gulf Cooperation Council (GCC), which represents Saudi Arabia, the UAE, Kuwait, Qatar, Bahrain and Oman, said the group would continue to foster energy security and avoid using oil as a weapon.
"The GCC works as a clear and honest partner as an oil exporter with the international community and we can't use that as a weapon in any way possible," Reuters cited GCC Secretary-General Jasem al-Budaiwi as saying.
By Charles Kennedy for Oilprice.com
Charles is a writer for Oilprice.com More