Bahri, also known as the National Shipping Company of Saudi Arabia, will spend $1bn to buy nine very large crude carriers (VLCCs) as the modernization of its fleet continues.

The deal was signed on August 19, 2024 with shipping firm Capital Maritime and Trading Corporation, a vessel operator. It currently operates a fleet of 38 tankers, including 15 VLCCs.

Delivery of the vessels is expected in multiple batches by the middle of next year. VLCCs can hold about two million barrels of crude oil, on average.

According to a joint statement, most of the nine VLCCs were built in South Korea, with an average age of six years and an average deadweight tonnage (DWT) of around 311,500. The vessels are equipped with high energy efficiency and low emission features to reduce environmental impact.

Saudi Arabia’s sea-based oil exports dropped in June, with the world’s largest crude exporter contributing to a global reduction in seaborne oil movements of just over one million barrels a day, the biggest monthly drop of the year.

The nation, which holds around 17% of the world’s proven crude oil reserves, accounted for around half of the decline.

Media reports indicate Bahri will pay 10% of the total transaction when the purchase agreement is signed, with the remainder paid on delivery of the vessels.

Bank facilities and internal cash resources will be used to for the purchases.

According to the Saudi shipping giant, the purchases will enable it to push forward its modernization plans, as well as streamline the process of phasing out older vessels.

The vessels will be employed within the Bahri Oil Transport business unit, which currently operates a fleet of 40 VLCCs.

Bahri currently has a fleet of 92 vessels, including 36 chemical and product tankers and six multipurpose vessels. It provides ship management services through its wholly-owned subsidiary, Mideast Ship Management Ltd.