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Saudi Arabia Shifts Trade Focus to Neom Port Amid Iran Tensions

Financial Times Companies •
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Saudi Arabia is positioning Neom's port as a strategic gateway connecting the Gulf with Europe and Africa, pivoting to its Red Sea coast after Iranian attacks disrupted shipping through the Strait of Hormuz. Crown Prince Mohammed bin Salman's ambitious Neom project has been scaled back following cost overruns, but the port represents a key infrastructure play amid regional turbulence.

The port handled 2.2 million tonnes of cargo in 2024, roughly 2% of Saudi imports, with satellite imagery showing active freight operations. While Neom's futuristic linear city was abandoned, the less-glamorous port and other western infrastructure have absorbed economic damage from the shipping disruptions that effectively cut off the oil-rich east coast from global trade.

Saudi exports via the west coast port of Yanbu surged roughly fourfold since February, reaching over 29 million barrels per week in early April. However, the westward shift exposes the kingdom to other risks, including Yemeni Houthi rebels and instability in east Africa, complicating the long-term strategy of reducing dependence on Iran-controlled shipping lanes.