UAE’s Adnoc Buys Tankers for $1.3 Billion as Crude Exports Boom

Abu Dhabi National Oil Co (ADNOC) has expanded its tanker fleet by acquiring five very large crude carriers (VLCCs) for about $590 million from Frontline Plc. This purchase includes two 2012-built vessels for approximately $115 million each and three 2015-built vessels costing about $120 million each. The move by ADNOC Logistics and Services (ADNOC L&S) is part of a strategy to gain greater control over its supply chain, enabling it to transport crude to customers despite geopolitical tensions impacting shipping routes such as the Red Sea and the Strait of Hormuz.

In addition to the VLCCs, ADNOC also acquired three very large gas carriers (VLGCs), each priced at about $115 million, bringing the total value of these specific vessel acquisitions to around $935 million. The company has also expanded its chartered fleet, bringing in approximately 25 crude tankers from South Korea's Sinokor following the escalation of regional crises. ADNOC L&S is also reported to have ordered another 25 to 30 new vessels, including crude tankers, LNG carriers, and LPG carriers, from various shipyards, further bolstering its capacity.

This investment in new ships directly responds to the months-long disruptions affecting shipping through the Red Sea and the Strait of Hormuz. These areas have seen increased conflict, tightening tanker supply and making it more challenging for oil producers to move crude efficiently. ADNOC L&S's strategy allows it to maintain crude movements to its storage terminals in Fujairah and Oman, outside the Strait of Hormuz, and directly to customers, demonstrating a proactive approach to mitigating geopolitical risks in oil transportation.

ADNOC L&S currently operates a substantial fleet, with over 340 owned vessels and an additional 600 chartered ships. The company's expansion efforts are aligned with a broader push by the UAE producer to secure its supply chain and ensure reliable delivery of crude to its global customers, particularly Asian refiners who have increased purchases of ADNOC cargoes amidst tightened supplies and shipping delays.