UAE oil exports are rising even as Gulf shipping faces pressure

The UAE is showing it can keep crude moving even with Hormuz under strain, despite its second pipeline bypassing the strait still being under construction. Bloomberg’s tanker data indicates exports held at about 2.6 mn bbl / d in May — not too far from its 3.1 mn bbl / d exports last year — and that’s thanks to a series of moves by Adnoc ranging from spot sales and flexible delivery options to braving the strait in the dark.

Adnoc sold at least 14 mn barrels of crude to Asian buyers through a spot tender, the business information service says, citing traders in the know. The cargoes — comprising Upper Zakum, Umm Lulu, and Das Blend crude — were placed with refiners across China, Japan, South Korea, and India, reportedly at premiums a few greenbacks above the Dubai benchmark. This is a sign that buyers are willing to pay up for crude that can be delivered despite logistical and security complications.

The sale follows the June-September loading tender we reported on last week, which allowed buyers to bid for up to 2 mn bbl per cargo on a cost-and-freight basis. The scale of the offering suggested Adnoc was prepared to market substantial volumes despite ongoing disruption to Gulf shipping routes.

The tenders are not just premiums — they are also about keeping buyers anchored. “With Gulf transits this thin, any reliably deliverable barrel commands a premium, and spot tenders let Adnoc capture that rather than locking it into term pricing,” Aditya Saraswat, MENA research director, tells EnterpriseAM.

More barrels are on the way — and delivery is looking very different. Adnoc launched a second tender offering the same crude grades for June-August loading, closing on 11 June, Reuters reports. Buyers can bid for up to 2 mn bbl per cargo, with crude available from Fujairah storage, Zirku Island, Das Island, or via ship-to-ship transfers between Fujairah and Sohar. That builds on earlier flexibility offered to term customers, who were told May cargoes could be lifted through alternative delivery points on a case-by-case basis.

Fujairah is the UAE’s Hormuz workaround. “The UAE has a Hormuz-independent export node in Fujairah, fed by Adcop at 1.8 mn bpd nameplate capacity. No other Gulf exporter except Saudi (via the East-West line to Yanbu, itself now exposed to Houthi threats) has anything comparable,” Saraswat says. “That’s why UAE crude exports have held near 60% of pre-conflict levels while purely Hormuz-dependent flows collapsed toward zero,” he adds.