Yanbu oil flows again as Red Sea risk settles into insurance premiums

A sailor mans a machine gun on the deck of a US destroyer at sunset in the Bab al-Mandeb Strait — USS Jason Dunham in the Bab al-Mandeb Strait, 7 October 2018 — archive photo, illustrativePhoto: U.S. Department of Defense / Wikimedia Commons · Public domain · Source

Why it matters

Barrels are flowing out of the Red Sea again, but the risk is not going away; it is only moving. The war risk premium at Yanbu is about 3% of hull value, up to 7% at southern Saudi ports and 6–9% in Hormuz. Between 30 and 43 ships a day cross Bab el-Mandeb, against a normal baseline of around 80. In the same week, Tigrayan forces turned towards Ethiopia's Djibouti trade corridor. With both shores of the Red Sea heating up, the fall in the oil price masks the lasting part of the cost: insurance and freight.

Implications

Brent futures rose to $108.83 on 28 September and closed at $105.28 on news that Yanbu loadings had resumed; the intraday pullback was $3.55.
War risk insurance for Saudi-linked tankers at Yanbu rose from below 1% in early July to about 3%; it reaches 7% at southern Saudi ports.
Daily transits through Bab el-Mandeb fell from a normal level of about 80 to a 30–43 range; the TPLF's advance in Afar added the African shore of the Red Sea to the risk map.

Map: Yanbu oil flows again as Red Sea risk settles into insurance premiums

Flows are back, prices only partly

Saudi Arabia resumed crude shipments from Yanbu on 28 September, ending a 17-day halt. According to an Investing.com report based on Bloomberg, the East-West pipeline carried about 4 million barrels a day before the attack, or roughly 4% of global supply. Drone attacks on 11 September hit 3 pumping stations, and a return to full capacity could take 6–8 weeks. The halt had left some European buyers with zero allocations in their October contracts.

The market priced the news the same day. According to EFE, November Brent rose to $108.83 at 15:39 TRT and closed the day at $105.28 after the Yanbu report. The intraday pullback of $3.55 shows that the Red Sea outlet now sets prices as much as the Hormuz talks do. Even so, the close was $0.96 above the $104.32 of 25 September. The return of physical flows did not erase the premium entirely.

Risk has moved into the policy

The part of the premium that has not been erased shows up on the insurance side. War risk insurance is an additional premium that shipowners pay for each voyage into a conflict zone, expressed as a percentage of hull value. According to an OilPrice.com analysis on 25 September, this premium for Saudi-linked tankers loading at Yanbu rose from below 1% in early July to about 3%. According to the same analysis, the premium reaches 7% at southern Saudi ports and a 6–9% range in Hormuz.

This gap points to an important distinction. The oil futures price fell within 1 day of Yanbu reopening. Insurers, however, price risk per voyage, and a single day without attacks does not change that price. The recovery news of 28 September also contains no data on any fall in insurance premiums. In other words, the delivered cost of each barrel shipped from the Red Sea is not falling as fast as Brent.

Bab el-Mandeb at half capacity

Traffic through the southern gate of the Red Sea confirms this cost. According to OilPrice.com, daily transits through Bab el-Mandeb fell from a normal level of about 80 ships to around 30. In Windward's data for 27 September, 21 ships entered the Red Sea through the strait and 22 left, for a total of 43 transits. The National's data, cited by GlobalSecurity, shows 27 transits on 24 September. At Suez, Windward recorded 23 entries and 15 exits on 27 September, for a total of 38 transits.

Because the figures are collected with different methods, they cannot be placed in a single series. All three sources, however, show traffic remaining below half of the normal baseline. Tankers sailing north from Yanbu to Suez do not have to pass through Bab el-Mandeb. Cargoes heading south to Asia, by contrast, use this strait, which is under Houthi threat.

The African shore joins the map

Red Sea risk is no longer confined to the Arabian Peninsula shore. According to Euronews, the Tigray People's Liberation Front (TPLF) took Erebti in Afar on 27 September and is advancing on Afdeera, about 100 km to the east. The target is the Djibouti corridor, which carries almost all of Ethiopia's foreign trade, including fuel. At least 150,000 people have been displaced in Afar.

Diplomatic tension rose on the same day. Ethiopia's chief of general staff accused Eritrea, Sudan and Egypt of backing Tigrayan forces. Sudan's army rejected the claim as baseless on 28 September. According to AP, Eritrea linked the tension to Ethiopia's search for a seaport. All three countries lie on the Red Sea coast, which shows both sides of the basin heating up at once.

Cargo is shifting back to Hormuz

While the Red Sea gate was closed, Riyadh shifted cargo to Hormuz. According to Windward, Saudi crude exports via Hormuz rose to about 3.6 million barrels a day in September, from about 0.9 million in August. On 27 September, 24 ships crossed Hormuz, and 14 of them had their identification signals switched off, meaning they were dark.

LNG has no such flexibility. According to The National, QatarEnergy extended its force majeure notice into early December on 28 September. According to gCaptain, at least 4 laden LNG carriers crossed the strait in the past week, compared with about 3 cargoes a day before the war. Qatar has no pipeline that bypasses Hormuz, so there is no Red Sea alternative on the gas side either.

What it means for Türkiye and what to watch

Türkiye imports oil at Brent-linked prices. The $3.55 intraday pullback on 28 September therefore looks reassuring at first glance. Part of the delivered cost, however, comes from insurance and freight, and that component has tripled at Yanbu since July. European buyers facing zero allocations in October also shows that Mediterranean refiners went through a tight month for Saudi crude.

There are three indicators for the next 2 weeks. The first is whether tanker departures from Yanbu become regular, along with an official figure for pipeline throughput. The second is whether daily transits through Bab el-Mandeb fall below 30. The third is whether the TPLF takes Afdeera and cuts the Djibouti highway. If the first comes in positive and the other two negative, Red Sea transport costs will keep rising even if the price stays calm.

Probabilities

Scenarios

Scenario	Probability	Trigger	Market impact
H1Fragile recovery	55%	Yanbu loadings continue and East-West pipeline throughput rises within weeks; there is no major new attack at Bab el-Mandeb, but transits stay in the 30–43 range.	Physical supply recovers gradually, but insurers keep pricing the Red Sea as a high-risk zone.
H2A new blow to the Red Sea	25%	Houthi or drone attacks hit Yanbu or the pumping stations again; the TPLF cuts the Djibouti highway.	Saudi exports are loaded back onto Hormuz, both shores of the Red Sea are disrupted at once and fuel supplies to Ethiopia stop.
H3Risk premium unwinds	20%	A round of US–Iran talks is announced, visible transits through Hormuz rise and several weeks pass without attacks in the Red Sea.	Cargo is balanced between the two outlets and insurers gradually lower premiums.

Module A

Constraints Matrix

STRUCTURAL AVG 4.3 · TACTICAL AVG 2.7Structural constraints dominate: the outcome is set more by these limits than by the actors' preferences.

Hard structural constraintspersistent · beyond the actors' will

No alternative for LNG
5/5
Qatar has no route that bypasses Hormuz; QatarEnergy extended force majeure into early December, with at least 4 laden transits a week.
Pipeline repair time · Saudi Arabia
4/5
The 11 September attacks hit 3 pumping stations; a return to full capacity on the East-West pipeline could take 6–8 weeks.
The Red Sea's southern gate
4/5
Daily transits through Bab el-Mandeb fell from a normal level of about 80 to a 30–43 range; cargo bound for Asia depends on this strait.
Ethiopia's single outlet
4/5
Almost all of Ethiopia's foreign trade passes through the Djibouti corridor; the TPLF has taken Erebti and is advancing about 100 km east.

Tactical frictiontemporary · eases over time

Insurance pricing weeks
3/5
The premium at Yanbu rose from below 1% in July to about 3%; because insurers price risk per voyage, premiums fall more slowly than futures prices.
European allocation gap weeks
3/5
The 17-day halt left some European buyers with zero allocations in October contracts; closing the gap depends on November loadings.
Measurement gap days
2/5
Figures produced with different methods are circulating for Bab el-Mandeb: 27 transits on 24 September, 43 on 27 September and an average of about 30.

Module B

Signal vs Noise

SIGNAL 60% · NOISE 40%

SIGNAL
Red Sea risk has moved from futures prices into insurance premiums
The war risk premium at Yanbu rose from below 1% in early July to about 3%; it is 7% at southern Saudi ports and 6–9% in Hormuz.
OilPrice.com — Aramco restores East-West pipeline as war risk closes in on Yanbu
SIGNAL
The Yanbu news pulled the price back on the same day
Brent rose to $108.83 at 15:39 TRT on 28 September and closed the day at $105.28 on news that Yanbu loadings had resumed.
Data: Brent crude oil (futures) ›Infobae (EFE) — El brent comienza la semana subiendo un 0,93 %
SIGNAL
The African shore of the Red Sea is also generating trade risk
The TPLF took Erebti on 27 September and is advancing on Afdeera, about 100 km east; the target is the Djibouti corridor carrying Ethiopia's foreign trade.
Euronews — Tigray rebels push into Afar as Ethiopia blames neighbours
NOISE
20 million barrels left Hormuz in one day, with flows above pre-war levels
The US energy secretary's statement of 27 September could not be verified with independent tracking data; Windward counts 24 transits on 27 September, 14 of them dark.
Data: Strait of Hormuz transits ›Yahoo Finance (Investing.com) — Saudi Arabia resumes Yanbu oil exports after pipeline repair
NOISE
Traffic through Hormuz has fallen to a single transit
The PortWatch record cited by Straits.live is 1 transit on 20 September and is lagged; Windward counts 24 transits for 27 September.
Data: Strait of Hormuz transits ›Straits.live — Strait of Hormuz Status, 28 September 2026

Module C

Asset-Class and Positioning Implications

Asset class	Exposure	Transmission channel	H1	H2	H3	Expected	Conviction	Horizon	What to watch
Freight & insurance	Red Sea war risk premium	Because insurers price risk per voyage, the premium falls more slowly than the oil futures price	+	++	−−	+0.65	●●●	0–3 months	War risk premium rates at Yanbu and southern Saudi ports
Commodities	Front end of the crude futures curve	Yanbu staying open limits the scarcity premium in near-dated contracts; a new attack brings the premium back	0	++	−−	+0.10	●●●	0–3 months	Brent's $104.32 and $108.83 levels
Commodities	Global LNG prices	With no Qatari alternative that bypasses Hormuz, force majeure limits supply through the winter	+	+	−	+0.60	●●●	3–12 months	QatarEnergy's notice for the period after December and weekly laden LNG transits
Credit	Gulf sovereign risk premium	The ability to switch Saudi exports between two outlets reduces revenue risk; narrowing at both gates raises it	0	−−	+	−0.30	●●●	3–12 months	An official figure for East-West pipeline throughput
FX	Energy-importing emerging market currencies	The insurance and freight component of delivered cost keeps the import bill high even if Brent falls	−	−−	+	−0.85	●●●	0–3 months	The threshold of 30 daily transits through Bab el-Mandeb

Second-order effects

And then what?

Starting point

Saudi Arabia resumed loadings at Yanbu on 28 September after 17 days, and Brent fell from a high of $108.83 to $105.28. The war risk premium at Yanbu, however, has risen since July from below 1% to about 3%.

1
Insurance and freightwithin days
The insurance premium stays high while the price falls, so the delivered cost of a barrel shipped from the Red Sea does not fall as fast as Brent. Shipowners keep avoiding Bab el-Mandeb, and daily transits stay in the 30–43 range.
Watch: The Yanbu war risk premium and daily Bab el-Mandeb transit counts
2
Route substitutionwithin weeks
As long as Saudi cargo bound for Asia cannot use the southern gate, it keeps shifting to Hormuz; exports via Hormuz rose to about 3.6 million barrels a day in September. This deepens reliance on dark transits in Hormuz and forces cargo to share the same narrow gate with cargoes like LNG that have no alternative.
Watch: Windward's daily Hormuz transits and the dark transit ratio
3
Import billwithin months
High delivered costs tied to both gates create a lasting surcharge on the bill for Brent-linked importers such as Türkiye. European buyers facing zero allocations in October tightens crude supply in the Mediterranean and makes November loadings decisive.
Watch: Saudi allocation announcements for November delivery and Türkiye's October energy import data

What breaks the chain

The chain breaks at the first link if the East-West pipeline nears full capacity within a few weeks and a period without Red Sea attacks is enough for insurers to cut premiums. A rise in visible transits through Hormuz would weaken the second link.

Triggers

Thresholds to watch

Indicator	Threshold	Today	What it means
Brent crude oil (futures)	> $108.83	105.28	A sustained break above the intraday high of 28 September would show that the price effect of the Yanbu recovery is exhausted and that a new disruption is being priced.
Bab el-Mandeb transits	< 30 ships	26	Daily transits falling below the level of 30 cited by OilPrice.com would signal a new escalation at the southern gate of the Red Sea.
Strait of Hormuz transits	> 24 ships	9	Transits settling above Windward's count for 27 September would show that the shift of Saudi cargo to Hormuz can be sustained.

Sources

Sourcing and verification rules: methodology · Report an error: contact

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