Bloomberg News

Dubai, Fujairah Ports Busy as Usual Amid Hormuz Passage Threat

January 06, 2012

Jan. 5 (Bloomberg) -- Dubai’s commercial port of Jebel Ali and terminals in Fujairah on the eastern coast of the United Arab Emirates operated normally today amid recent threats by Iran to block shipments through the nearby Strait of Hormuz.

“If the Hormuz Strait was shut, it will affect business,” Jim Williams, Middle East and North Africa Engineering Manager at Aesseal, which makes pump seals for the oil and gas industry, said in an interview in Jebel Ali today. “There will always be alternative routes, even if at more cost.”

Iran threatened last month to shut the Strait of Hormuz, a transit point for a fifth of oil traded worldwide, if sanctions are imposed on its crude exports in response to its nuclear program. It began naval exercises in the waterway on Dec. 24, according to the Islamic Republic News Agency. Greece this week lifted its objections to a European Union embargo that may be adopted Jan. 30.

At the DP World Ltd.-operated Jebel Ali port southwest of Dubai, cranes handle containers from cargo vessels moored at a number of docks, moving them to storage facilities operated by Jebel Ali Free Zone FZE. Hundreds of identical, newly- manufactured cars are lined up along exit roads while trucks carrying prefabricated cabins make their way into Jebel Ali where they’ll be used as offices for overseas companies expanding in the region.

Shipping operations continued as normal in ports across the United Arab Emirates, OPEC’s fifth-biggest producer, said Nikos Varvaropoulos, a Dubai-based official at Optima Shipbrokers Ltd. “So far, everything is okay,” he said.

Port of Fujairah

At the port of Fujairah on the Gulf of Oman, the biggest shipping fuel terminal in the Middle East, activities were normal, as work continued on the construction of crude and fuel storage terminals.

Tensions related to the threats of shutting the Strait of Hormuz boosted shipping fuel rates in Fujairah. Prices for 380- centistoke marine bunker fuel were at $719.50 a metric ton in Fujairah today. That’s up 6 percent from $678.50 a week ago.

Shipping through the Strait of Hormuz itself, from food to petrochemicals and auto parts, is carrying on as usual, according to Transport Intelligence Ltd., a logistics consultant in Wiltshire, England. “Things are running normally so far,” Chief Executive Officer John Manners-Bell said by phone today.

--With assistance from Alaric Nightingale, Lananh Nguyen and Isaac Arnsdorf in London and Bruce Stanley in Dubai. Editors: Rachel Graham, Raj Rajendran

To contact the reporters on this story: Nayla Razzouk in Dubai at; Anthony DiPaola in Dubai at

To contact the editor responsible for this story: Stephen Voss at

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