Freight rates for tankers transporting Saudi crude oil from the Red Sea port of Yanbu to Asia have dropped sharply from highs seen earlier this month, as more vessels are shifting to this export route that bypasses the Strait of Hormuz.

According to sources familiar with the transactions and broker reports cited by Bloomberg, shipping costs for the Yanbu-Asia route have plummeted from over $450,000 per day in early March to approximately $200,000 per day for a 2011-built very large crude carrier (VLCC) contracted this week.

With the Persian Gulf-Asia route effectively closed for most crude oil, particularly supplies from Saudi Arabia, the port of Yanbu has become the preferred location for tankers to remain active in shipping crude from the Middle East to its key export market in Asia.

As commercial traffic through the Strait of Hormuz remains near a standstill, Saudi Arabia is accelerating the shift of shipments away from the strait toward the Red Sea.

Maritime intelligence firm Windward stated in a report on Monday, "Iran continues to enforce a controlled transit model through the Strait of Hormuz, using corridors managed by the Islamic Revolutionary Guard Corps (IRGC), allowing selective passage based on cargo type and destination."

With the Strait of Hormuz only open at the discretion of the IRGC, Saudi Arabia is redirecting as much of its crude oil exports as possible to the Red Sea route.

Citing Vortexa ship-tracking data, Windward reported that during the week of March 15–21, the port of Yanbu loaded approximately 22.9 million barrels of crude oil, a 20% increase compared to the previous week.

Windward noted, "This acceleration reinforces Saudi Arabia’s strategic pivot toward Red Sea export routes to reduce dependence on the Gulf shipping corridor."

Despite the shift to Yanbu, Saudi Arabia has not been able to fully compensate for the loss of all pre-conflict supplies that were transported via the Strait of Hormuz.

It has been reported that Saudi oil giant Aramco has informed its term supply customers in Asia that they will receive only Arab Light crude, its main flagship product, loaded at the Yanbu export terminal in the Red Sea for April shipments.

According to Kpler data, Saudi Aramco has exported approximately 4.355 million barrels per day (bpd) of crude oil so far in March. This is significantly lower than the 7.1 million bpd exported in February, before the de facto closure of the Strait of Hormuz.