Sohar offers alternative oil storage

Oil majors that regularly ship barrels to Asia have found that the oil storage capacity outside the Strait of Hormuz is crucial. The strait has become even more important after Iran threatened to block the largest oil and gas shipping route in the world. Strong oil and oil products demand in Asia have prompted many oil producers and trading companies to secure oil storage rights in the region. But there are now other ports outside of the Strait of Hormuz that have become major bunkering hubs, such as Fujairah, located on the east coast of the United Emirates. A new pipeline that bypasses the Strait of Hormuz will soon transport crude from Abu Dhabi to Fujairah; and there are plans to build a refinery in the emirates. The port of Sohar in small, non-OPEC producer Oman is now offering competition and oil traders have already secured oil storage spaces there. Sohar is also expanding its facilities by upgrading its refineries. (February 28, 2012)