TLDR: Chevron is rerouting its oil exports from the Red Sea to Asia due to the threat of attacks by Yemen’s Houthi rebels. Instead of going through the Red Sea and Suez Canal, Chevron will now ship oil via the Cape of Good Hope in Africa. The decision comes after the Houthis intensified their attacks on US shipping in the Red Sea, prompting companies to find alternative routes. Chevron’s cargoes of Kazakshtan’s Caspian Pipeline Consortium (CPC) Blend oil will now have to take a longer route, driving up shipping costs.
Chevron has rerouted its oil exports from the Red Sea to Asia due to the threat of attacks by Yemen’s Houthi rebels. The US oil giant will now send cargoes of Kazakhstan’s Caspian Pipeline Consortium (CPC) Blend oil via Africa’s Cape of Good Hope instead. The decision comes as the Houthi rebels have intensified attacks on US shipping in the Red Sea, prompting vessels to avoid the volatile region. The Red Sea and Suez Canal have traditionally been the shortest sea route between Europe and Asia. Chevron’s decision to reroute its oil shipments will drive up shipping costs, as the new route is much longer.
Most of the CPC Blend crude is from Kazakhstan, but some is from Russian companies. While Chevron is avoiding the route through the Red Sea, the Russian-sourced CPC Blend will still travel via the region. Since the outbreak of the Red Sea skirmishes, CPC Blend supplies to Asia have more than halved in January.
Chevron stated that it will continue to assess the safety of shipping routes in the Red Sea and throughout the Middle East, making decisions based on the latest developments. The Caspian Pipeline Consortium is the main exporter of Kazakhstan’s crude oil, with the major shareholders being the Russian state company Transneft, Kazakhstan’s KazMunayGas, and Chevron Caspian Pipeline Consortium Company.