Why is Aramco considering a new oil pricing mechanism for shipments from Egypt's Sidi Kerir port to Asia?

Aramco is considering a new official selling price for oil loaded at Egypt’s Mediterranean port of Sidi Kerir due to heightened security risks in the Red Sea caused by Houthi militant attacks, which have made traditional routes—including shipments from Yanbu—less viable and prompted shipowners to avoid the area; as a result, Aramco has redirected some Asian deliveries to Sidi Kerir, requiring a separate pricing structure since its existing Asia benchmark prices assume cargoes are lifted from Ras Tanura, and Yanbu-based sales are already negotiated privately.

What are Asian refiners demanding in response to Aramco's shift to Sidi Kerir shipments, and why?

Asian refiners—including state-run Indian processors—are demanding discounts of $5 to $10 per barrel for oil loaded at Sidi Kerir compared to the official selling price for Yanbu cargoes, citing higher freight costs and significantly longer transit times caused by the need to sail around the Cape of Good Hope instead of using the Red Sea route; they are seeking these reductions for both already-booked August cargoes and the upcoming September official prices, which Aramco is scheduled to announce next month.

Aramco Mulls New Oil Pricing for Asia as Houthis Threaten Flows

Jul 29, 2026

Saudi Aramco is considering new pricing for oil loaded at Egypt's Sidi Kerir port due to Houthi attacks in the Red Sea. Asian refiners are seeking discounts to offset higher freight costs and longer transit times.

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