Tanker owners loaded a record number of very large crude carriers from Guyana in May, as international refiners turned to South American barrels to make up for the collapse in Middle East exports caused by the Gulf crisis.

Seven cargoes of two million barrels each were lifted from the South American producer last month, according to shipbroker MB Shipbrokers. The figure marks the highest monthly total recorded since Guyana began attracting VLCC traffic, and it underscores how quickly the country has moved from a peripheral exporter to a destination that refiners now factor into their planning.

Guyana's emergence as a VLCC loading point is itself a recent development. For most of its short history as an oil producer, the country relied on Suezmax tankers, which carry roughly half the volume of a VLCC and have been better suited to its port draught and field output. The shift toward larger vessels reflects both the scale of new production coming online and the pull of refiners further afield, who find VLCCs more economical over long distances despite the additional loading time involved.

A crisis in the Gulf reshapes the map

The catalyst for the change lies thousands of miles away, in the waters around the Strait of Hormuz. Since late February, attacks on oil infrastructure and a near halt in tanker transits through the strait have throttled the flow of crude out of the Middle East. Loadings around the Persian Gulf, which averaged around 19 million barrels a day in February, fell to a fraction of that level within weeks, and Hormuz transits that had run at well over a hundred a day dropped to single figures.

The effect on the VLCC market has been severe. Global crude exports carried on VLCCs have fallen by more than a third compared with levels before the crisis, even as freight rates for the few vessels still serving the Gulf have soared. Dozens of VLCCs remain trapped inside the strait or are waiting to load at Saudi Arabia's Red Sea terminal at Yanbu, which lacks the capacity to absorb the volumes that would normally move through Hormuz.

Refiners in Asia and Europe have responded by diversifying away from a region they can no longer rely on for predictable supply. Brazil, the United States Gulf Coast, Nigeria and Guyana have all seen increased interest from buyers seeking to offset the shortfall, though none can replace Middle East volumes on their own. For many buyers, the calculation has become less about price and more about securing cargoes at all, even if that means accepting the longer voyage times that come with sourcing from the Atlantic basin.

Infrastructure built for growth, not crisis

Guyana's capacity to answer this demand owes much to investment made well before the Gulf crisis began. The One Guyana floating production, storage and offloading vessel, which came on stream in August last year as part of the Yellowtail development, lifted the country's installed production capacity above 900,000 barrels a day. Output from the Stabroek block has continued to climb steadily since, reaching 918,000 barrels a day in February, according to Guyanese government data, with ExxonMobil now seeking approval to push output from Yellowtail even higher.

That additional production has given the country the volume needed to fill VLCCs regularly rather than relying solely on the smaller Suezmax liftings that have historically dominated its export profile. Without the extra barrels from One Guyana, last month's record would not have been possible.

What it means for the tanker market

For shipowners, the record loadings carry implications beyond Guyana itself. VLCC voyages from South America to Asia or Europe run considerably longer than those from the Middle East, which means each cargo occupies a vessel for far more days at sea. That dynamic has helped keep tonne mile demand higher than the simple volume figures suggest, even as the disruption in the Gulf has reduced the total barrels VLCCs are carrying worldwide.

Brokers expect Guyana's pull on VLCC tonnage to persist for as long as the situation in the Gulf remains unresolved. Whether that proves a temporary diversion or a more lasting change in trading patterns will depend largely on how quickly, and how fully, transits through Hormuz return to normal.

What is already clear is that Guyana has established itself as a meaningful non-OPEC supply source capable of absorbing some of the shock when established producing regions falter. A country that exported its first barrel of oil only in December 2019 is now part of the calculation refiners make when a crisis thousands of miles away threatens to leave them short.

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