TODAY: Which routes are worth flying?

Good morning, everyone. China’s zero-tariff window is open to Egyptian exporters — but the hard work of turning preferential access into real orders is just beginning. We look at what it takes to sell into the world's largest consumer market.

Elsewhere, MGX closes a near-USD 50 bn raise to accelerate its AI push, AD Ports tightens its grip on Global Feeder Shipping, and UAE crude exports continue their steady climb back toward pre-war levels.

UAE rebounds

The UAE’s oil exports are at 85% of pre-war levels, according to the International Energy Agency. That’s 4.3 mn bbl / d in early June, up from 1.9 mn bbl / d in March — a more-than-doubling in roughly 10 weeks, before the US-Iran interim agreement even took hold. The infrastructure did what it was built to do — Adcop rerouted crude around Hormuz, the Mandous storage complex kept barrels moving, and Adnoc's own tanker fleet improvised the rest.

The UAE also found ways to keep exports flowing through Hormuz. Some cargoes continued transiting the strait with tankers switching off their transponders, with Adnoc relying on its own fleet, often deploying smaller shuttle tankers before transferring barrels to larger vessels. The company has sold at least 30 mn barrels of spot crude to Asian refiners and trading houses so far in June.

SAR, Italy ink rail partnership agreement

Saudi Arabia and Italy hit the railway tracks: Saudi Arabian Railways (SAR) and Italian State Railways (FS) signed an MoU to develop rail and transit projects across the MENA region, according to a press release. The broad framework covers infrastructure development, network digitalization, and transport decarbonization, while also exploring AI and machine learning initiatives that back construction, design, and operational activities.

Railway expansion seems to be gaining more ground: Spain already lends a hand in Saudi infrastructure. A Saudi-Spanish consortium built and runs the Haramain High-Speed Railway linking Makkah and Madinah, while Talgo has an order from Saudi Railways for 20 more high-speed trains. Meanwhile, Riyadh and Ankara have also expanded rail cooperation, and the cabinet recently approved the Kingdom’s accession to the GCC railway agreement — a 2.1k-km railway project that aims to link the six GCC member states.

A temporary system

Oman puts a framework around Hormuz passage: Muscat has designated temporary shipping corridors north and south of the Strait of Hormuz’s existing Traffic Separation Scheme, which it says is currently unsafe. Under an International Maritime Organization-coordinated plan, vessels will wait in international waters, be grouped, and receive individual instructions on their transit day and assigned route, keeping AIS active and maintaining contact with coastal authorities.

No-charge toll — for now: Passage will remain at no-charge under the arrangement, though talks with Iran on longer-term navigation and the cost of maritime services will continue after the 60-day window in the US-Iran agreement.

The system aligns with the Joint Maritime Information Center guidance — which had opened the Omani-side southern corridor to vessels sailing with AIS live, navigation lights on and VHF open, with US Navy coordination optional. The difference now is that the southern passage is part of a wider IMO-managed evacuation plan rather than an ad hoc route choice — leaving ships with a clearer operating framework, but still subject to phased movements, congestion risks, and continued mine-clearance concerns.

Market watch

Oil prices extended their decline today to trade closer to pre-war levels as stranded tankers exited the Strait of Hormuz, easing supply concerns, Reuters reports. Brent crude futures for August delivery fell USD 0.40 to USD 73.34 / bbl as of 04.36 GMT, while WTI fell USD 0.27 to USD 70.07 / bbl.

The Baltic Index stays under pressure: The Baltic Exchange’s dry bulk index — which tracks rates for the capesize, panamax, and supramax vessel segments — fell 1.2% to 2,634 points on Wednesday. The capesize index dropped 2.4% to 3,950 points, while the panamax index slipped 0.7% to 1,693 points. The smaller supramax index rose 1.3% to 2,071 points.

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