Saudi Aramco, the world’s largest oil company, is continuing to send tanker loads of crude and fuels through the southern Red Sea, where Houthi militants have for months been menacing merchant ships in response to the Israel-Hamas war in Gaza.

“We’re moving in the Red Sea with our oil and products cargoes,” Mohammed Al Qahtani, who heads Aramco’s refining and oil trading and marketing businesses, said in an interview at the company’s headquarters in Dhahran. The associated risks are “manageable,” he said.

The decision contrasts with swaths of other tanker owners who abandoned Red Sea trips after the US and UK bombed parts of Yemen in an effort to quell the Houthi attacks. The militants responded by saying both nations’ shipping would be targeted, alongside that of Israel prompting naval warnings for merchant vessels to stay away. 

Even before the US and UK attacks, which have been ongoing since Jan. 12, hundreds of container ships and many other merchant vessels had already veered away from the area — an unavoidable route for any carrier wanting to use the Suez Canal to cut between Asia and Europe. 

That’s lengthened voyages and delayed cargoes of everything from fuels to car parts as many of the ships go the longer way around Africa. It’s also fanning concerns about a return of inflation.

The Saudis have called for restraint in the US and UK strikes against the Houthis, trying to keep its own peace talks alive with the militants. The kingdom is seeking to end its militarily involvement in Yemen’s civil war, a conflict that has seen the rebels attack Saudi oil installations in the past.

The US and UK imposed sanctions Thursday on four Houthi officials, while China reiterated a call for attacks on shipping to be reined in.

Saudi Arabia’s location — with the Red Sea on its west and the Persian Gulf on its east — makes it somewhat tricky for OPEC’s largest producer to avoid using the area. 

Aramco regularly brings crude and fuel from the Persian Gulf, where its largest oil fields and major refineries are located. 

There have been a steady stream of shuttle tankers going through the southern Red Sea — including to and from the Jizan refinery in the Red Sea — since the conflict started, tanker tracking compiled by Bloomberg shows. A fuel cargo for Jordan also went through. 

However, Aramco’s customers have shipped no crude cargoes through the Red Sea so far this month that might at other times have gone through the waterway via Egypt to buyers in the west. Such flows are intermittent anyway because most Saudi crude goes to Asia.

At least two other tankers that loaded Saudi crude at Ras Tanura and fuel at Jubail, both in the Gulf, are making their way around Africa on the trip to Europe, rather than taking the shorter route through the Red Sea, according to ship tracking.

Saudi Aramco also uses a cross country pipeline to ship some crude from its main fields in the east to the Red Sea coast, from where it can be exported via the Suez canal, Qahtani said.

In the first half of January, Aramco shipped as much crude from its Red Sea terminal at Yanbu northwards toward Europe as it did in the whole of the previous month, vessel tracking data compiled by Bloomberg show.

“That is also giving us huge access and optionality,” Qahtani said. “We are assessing that almost on a daily basis.”

Still, like the rest of the industry, Aramco is having to deal with fewer vessels willing to travel into the Red Sea and higher insurance costs for doing so.

“The impact is on the costs of these shipments,” said Qahtani, whose official title is Downstream President. “It’s increasing as a result of what’s happening. But overall it’s is very manageable.”

The 16,200 TEU Ane Maersk is the first in a series of 18 large methanol powered ships ordered by the Danish shipping company.

The vessel is named after Ane Mærsk Mc-Kinney Uggla, the Chair of the AP Moller Foundation and AP Moller Holding and christened by her eldest granddaughter.

The Ane Maersk will be deployed on Maersk’s AE7 service between Asia and Europe from February. The vessel will be fueled with green methanol for its maiden voyage and said it continues to work diligently on sourcing green fuels for 2024 – 2025.

Maersk classifies green fuels those with either low GHG emissions -  65-80% life cycle GHG reductions compared to fossil fuels, or very low GHG emissions - 80-95% life cycle GHG reductions compared to fossil fuels.

“This series of vessels will have a transformative impact on our ambition to progress on our industry-leading climate ambitions. It is a visual and operational proof of our commitment to a more sustainable industry. With “Ane Mærsk” and her sister vessels we are expanding our offer to the growing number of businesses aiming to reduce emissions from their supply chains,” said Vincent Clerc, Chief Executive Officer of AP Moller-Maersk.

An unusual feature of the Ane Maersk for a large box ship is the front placement of the bridge and accommodation block which Maersk says ensures fuel efficient operations.

Maersk was first mover in methanol powered container ships, and it has quickly gained popularity as an alternative for container ship newbuild orders with 106 contracted last year according to figures from DNV. Concerns however remain over the supply of blue or green methanol as fuel given limited production at present.

A ship belonging to US-based Eagle Bulk Shipping (NYSE: EGLE) has been hit by a missile in the Gulf of Aden.

The United Kingdom Maritime Trade Operations (UKMTO) office said a Master reported a missile hit the ship’s port side from above approximately 95 nautical miles south east of Aden, Yemen.

The U.S. Central Command has confirmed details of the incident, reporting that the M/V Gibraltar Eagle was hit by an anti-ship ballistic missile fired from Houthi-controlled areas of Yemen. The ship has reported no injuries or significant damage and is continuing its voyage.

The M/V Gibraltar Eagle is a Marshall Islands-flagged bulk carrier owned by an entity of Eagle Bulk Shipping (USA) LLC, based in Stamford, Connecticut. The incident follows an earlier failed missile launch by the Houthis.

“Earlier in the day, at approximately 2 p.m. (Sanaa time), U.S. Forces detected an anti-ship ballistic missile fired toward the Southern Red Sea commercial shipping lanes. The missile failed in flight and impacted on land in Yemen. There were no injuries or damage reported,” the U.S. Central Command said.

“As a result of the impact, the vessel suffered limited damage to a cargo hold but is stable and is heading out of the area,” Eagle Bulk said. “All seafarers onboard the vessel are confirmed to be uninjured. The vessel is carrying a cargo of steel products.”

The Houthi group on Monday claimed an “accurate and direct” hit on an “American ship” and declared all American and British ships and warships as “hostile targets.”

This latest incident is near where another vessel reported a missile landing in the water nearby after being followed by three small boats on Friday, January 12. On that same day, another vessel reported seeing small boats in the same area.

UK-based security firm EOS Risk Group said that the arrival of the Iranian spy ship M/V Behshad in the Gulf of Aden on January 12 heightens the risk of attacks in the area. “MV BEHSHAD is likely providing targeting data to the Houthis ashore in Yemen,” the group said in a post to “X”.

On Sunday, a U.S. fighter jet shot down an anti-ship cruise missile near Hudaydah, Yemen that was fired from Yemen towards the USS Laboon (DDG 58) in the Southern Red Sea.

Today’s missile attack is the 29th attack on shipping by the Iranian-backed Houthis since November in support of Palestinians in Gaza. The group says the attacks are only against Israeli-linked ships and not international shipping. The incident also marks a rare successful missile strike since the establishment of Operation Prosperity Guardian in mid-December. The last reported successful strike took place on December 30 against the M/V Maersk Gibraltar, causing no significant damage.

Today’s attack comes after military strikes by the U.S. and UK on multiple targets in Yemen last Thursday. The U.S. launched a follow-on strike on Friday against a Houthi radar site in Yemen.

The Houthis have vowed retaliation for the attacks.

Eagle Bulk Shipping is one of the world’s largest owner-operators in the midsize dry bulk vessel segment.

Representing Twenty other US Republican and Democratic senators, US senators Bob Casey and Marco Rubio have sent a letter dated January 11 to the AMP’s Department of Resolutions and Inquiries to ask the entity to investigate 189 Panama-flagged vessels. The ships in question represent around 50% of the 383 "ghost fleet" vessels identified by non-profit organization United Against Nuclear Iran (UANI) as dedicated to the transfer of oil from Iran, despite widespread US sanctions against the nation and its oil industry in particular. 

The senators say that no other flag represents more than 5% of the identified ghost fleet vessels, and that AMP has de-flagged just 28 of the 217 vessels of concern. 

“We are concerned that the Panama Maritime Authority is not doing the necessary due diligence [for the flagging of these ships] we are further concerned that the practices used to evade US sanctions on Iranian oil could also be used to evade US sanctions on Russian oil, contributing to that nation's abhorrent atrocities in Ukraine and elsewhere," the letter said.

“The United States has enacted a series of sanctions against the Iranian regime in response to and condemnation of Iran's serious human rights abuses and state sponsorship of terrorism. From supporting groups like Hezbollah and Hamas, backing the brutal Syrian regime, accelerating its nuclear, drone and ballistic missile programs, to killing hundreds and arresting thousands of its own people, in the violent suppression of internal protests…Iran consistently works in opposition to peace, stability, democracy, and shared American values ​​and interests throughout the Middle East,” the senators said.

“In recent years, Iran and its buyers have used a 'ghost fleet' of vessels that employ creative techniques to conceal the origin of Iranian oil, allowing Iran's oil revenues to recover. These mechanisms include transferring oil between tankers at sea, turning off GPS trackers before docking in Iran, repainting of vessels mid-voyage, 'flag hopping' between different national registries, and labelling oil as different types of fuel.

The senators said that the ghost fleet has enabled the export of hundreds of millions of barrels of Iranian oil in recent years. “We therefore request that you cooperate with the United States and conduct investigations into a significant number of ships registered in Panama which are alleged to transport Iranian oil in violation of U.S. sanctions.

In January 2023, the AMP issued a statement that between 2019 and 2022 it had de-flagged 678 vessels from its registry in compliance with the United Nations Convention on the Law of the Sea (Unclose) and in line with Panama's efforts to combat terrorist financing and illegal, unreported, and unregulated fishing. That statement was in response to another similar pronouncement by Republican Jeff Bush.