Ahmed Ali Al-Subaey, CEO of Bahri
The disruptions in maritime traffic through the Strait of Hormuz during Q1 2026 were a key factor in changing demand patterns and increasing freight rates, amid shortage in tanker availability and higher levels of market risk, Ahmed Ali Al-Subaey, CEO of National Shipping Company of Saudi Arabia (Bahri), told Argaam in an interview. 
These developments drove customers to increase demand for flexibility and rapid response, he noted, confirming that Bahri maintained full commercial utilization of its fleet.
The crude oil transportation segment was the key driver of performance, supported by higher freight rates and the expansion of the fleet to 50 tankers, which enabled Bahri to absorb demand and improve utilization efficiency, while resorting to chartering tankers when needed.
He pointed out freight markets, particularly crude tanker markets, are inherently cyclical and currently influenced by geopolitical developments, trade flow shifts, and vessel supply dynamics.
Al-Subaey also expects Q2 2026 to remain influenced by geopolitical developments, particularly around key maritime routes and the Strait of Hormuz. “Freight rates and demand patterns are likely to remain volatile, and visibility remains limited given the pace at which trade flows and customer requirements can change,” he said.
The CEO further stated that freight rates are expected to moderate if conditions stabilize, while the company remains focused on operational efficiency and maximizing fleet utilization, backed by the diversification of its business and the strength of its financial position.
Below is the detailed interview:
Bahri reported net profit growth of over 300% in Q1 2026. What are your comments on the results? Are these levels sustainable for the remainder of the year? How much of the growth was driven by higher global freight rates versus increased operational activity?
Bahri delivered an exceptionally strong first quarter, with net profit increasing by 303% year-on-year (YoY) to SAR 2.15 billion. This performance reflects a combination of favorable market conditions, disciplined commercial execution, and the benefit of the fleet expansion and modernization program we have undertaken over the past period.
The largest contributor to this growth was our crude oil transportation business, where freight rates were materially higher during the quarter. However, the performance was not driven by rates alone. Our VLCC fleet, which stood at 50 vessels at the end of Q1 2026, compared to 44 vessels at the end of Q1 2025, allowed us to capture more demand and deploy owned tonnage more effectively. We also increased charter-in activity where required to meet customer needs and maintain service levels.
In terms of sustainability, we do not assume that Q1 market conditions will remain unchanged throughout the year. Freight markets, particularly crude tanker markets, are inherently cyclical and currently influenced by geopolitical developments, trade flow shifts, and vessel supply dynamics. What we believe is sustainable is Bahri’s stronger operating platform: a larger owned fleet, disciplined fleet deployment, long-standing customer relationships, and a more diversified business base across oil, chemicals, dry bulk, logistics, and marine services.
Our focus for the rest of the year will be on what we can control: safe operations, disciplined commercial decisions, cost efficiency, customer reliability, and maintaining balance sheet strength.
How did geopolitical tensions and disruptions in the Strait of Hormuz impact demand patterns and freight rates during Q1? Did they help drive the performance?
The disruption to maritime traffic through the Strait of Hormuz was a significant factor affecting market conditions during the quarter. Following the escalation of regional tensions, tanker transits through the Strait became highly disrupted, and crude flows increasingly shifted toward alternative routes, including the Red Sea corridor.
This created tighter vessel availability and a higher risk premium in the crude tanker market, which contributed to a sharp increase in quoted freight rates. It also changed customer requirements, as customers required more flexibility, faster response times, and reliable access to tonnage in a more complex operating environment.
For Bahri, the priority throughout the quarter was the safety of our people, vessels, and cargo. Despite the disruption, all owned and chartered vessels remained safe and commercially deployed throughout the period. Our ability to navigate these conditions was supported by our in-house ship management capabilities, our experienced crews and onshore teams, and our long-standing regional and international partnerships.
So yes, regional developments contributed to the stronger freight environment. However, Bahri’s performance also reflected our ability to respond operationally and commercially to those developments in a disciplined and reliable way.
The oil transport segment recorded a SAR 2.6 billion YoY increase in revenue. Was this mainly driven by higher rates or improved utilization levels?
The increase in Bahri Oil revenue was primarily driven by materially higher freight rates, but utilization and fleet scale were also important contributors.
Bahri Oil revenue rose by 241% YoY to SAR 3.74 billion, while EBITDA increased by 253% to SAR 2.12 billion. The pricing was much stronger than in Q1 2025, supported by improving supply-demand dynamics, firmer Middle East crude exports, tighter vessel availability, and the geopolitical risk premium that developed during the quarter.
At the same time, our expanded VLCC fleet played a key role.
This gave us greater capacity to serve customer demand and capture the stronger rate environment. We also increased voyage charter-in activity to meet higher customer requirements.
Therefore, the main driver was at higher freight rates which started to rise since the fourth quarter of 2025, but the scale and availability of our fleet allowed us to translate those market conditions into stronger revenue and earnings.
What is you outlook on VLCC freight rates in the coming period? Are you starting to observe any signs of normalization or stabilization?
The VLCC market remains highly volatile, and the near-term outlook depends heavily on developments around key trade routes, particularly the Strait of Hormuz, as well as broader crude export flows and vessel availability.
At the start of Q1 2026, the market was already supported by stronger fundamentals, including the gradual unwinding of OPEC+ production cuts, firmer Middle East crude exports, increased sourcing from the Atlantic Basin, and tighter vessel availability. The escalation of regional tensions then added a significant risk premium and pushed freight rates higher.
Looking ahead, if regional conditions stabilize and traffic through key maritime corridors normalizes, we could see some moderation in freight rates from the elevated levels observed during Q1. However, if uncertainty persists, rate volatility is likely to continue.
For Bahri, the priority is not to make short-term calls on rates, but to remain agile. We will continue to focus on disciplined commercial execution, flexible fleet deployment, and supporting customer requirements across changing market conditions.
How do you assess current demand for chemical shipping compared with oil transport in terms of growth and margins?
Oil transportation delivered the strongest growth in Q1, mainly because of the sharp increase in crude tanker freight rates since the fourth quarter of 2025 and the impact of regional disruption on VLCC demand.
However, Bahri Chemicals Products also delivered a strong quarter. Revenue increased 14% YoY to SAR 796 million, while EBITDA rose 42% to SAR 506 million, with EBITDA margin improving to 64% from 51% in Q1 2025. This improvement was supported by disciplined commercial execution, a continued focus on higher-margin clean petroleum products cargoes, proactive vessel deployment, and efforts to minimize off-hire days.
The chemicals and products business are different from oil transportation. It is generally more diversified across cargo types, trade lanes, and customer relationships. In Q1, the business benefited from firmer clean petroleum products market conditions and from long-term contractual relationships, including renewed COAs with Luberef and SABIC, as well as a new COA with Mitsui Co., the first concluded through our Singapore office.
Therefore, while oil was the main earnings driver in Q1, Chemicals Products remains an important contributor to Bahri’s diversification strategy and margin resilience.
Are there any expected fleet expansions or new contracts that could support growth during 2026?
Bahri’s owned fleet remained stable at 104 vessels during Q1 2026, with no additions or divestments during the quarter. However, the company has a clear newbuild orderbook that supports future growth and fleet renewal.
The orderbook includes two offshore support vessels expected in 2026, six geared Ultramax dry bulk vessels scheduled for delivery between 2028 and 2029, and two RoCon vessels scheduled for delivery in 2029. These vessels are aligned with our strategy to expand selectively into adjacent logistics and maritime services, improve fleet versatility, and support long-term earnings capacity.
From a commercial perspective, Q1 also saw important progress in strengthening long-term demand visibility. Bahri Chemicals Products renewed its COAs with Luberef and SABIC and secured a new COA with Mitsui Co. This is particularly significant as the Mitsui agreement was the first COA concluded through Bahri’s Singapore office, which strengthens our reach in East and Southeast Asia.
During 2026, we will continue to focus on maximizing the value of our existing fleet, delivering on our newbuild commitments, and pursuing selective contracts that enhance earnings quality and long-term customer relationships.
How do you view demand and freight rates in Q2 2026 amid ongoing geopolitical developments? And what are your expectations for the company’s performance in the quarter?
We expect Q2 to remain influenced by geopolitical developments, particularly around key maritime routes and the Strait of Hormuz. Freight rates and demand patterns are likely to remain volatile, and visibility remains limited given the pace at which trade flows and customer requirements can change.
That said, Bahri enters Q2 from a strong position. We have a larger owned fleet, strong customer relationships, long-term contractual coverage across key segments, and proven operational resilience. All owned and chartered vessels remained commercially deployed throughout Q1 despite regional disruption, and our priority will remain maintaining that discipline.
Q1 benefited from exceptionally strong freight conditions, particularly in crude oil transportation. If freight rates moderate, performance could normalize from Q1 levels. However, our focus remains on safely serving customers, optimizing fleet deployment, protecting margins, and managing costs and capital allocation carefully.
Our scale, integrated capabilities, and regional and international partnerships allow us to respond quickly to changing market conditions while continuing to support essential trade flows for the Kingdom and global markets.
Ahmed Ali Al-Subaey, CEO of Bahri
The disruptions in maritime traffic through the Strait of Hormuz during Q1 2026 were a key factor in changing demand patterns and increasing freight rates, amid shortage in tanker availability and higher levels of market risk, Ahmed Ali Al-Subaey, CEO of National Shipping Company of Saudi Arabia (Bahri), told Argaam in an interview.
These developments drove customers to increase demand for flexibility and rapid response, he noted, confirming that Bahri maintained full commercial utilization of its fleet.
The crude oil transportation segment was the key driver of performance, supported by higher freight rates and the expansion of the fleet to 50 tankers, which enabled Bahri to absorb demand and improve utilization efficiency, while resorting to chartering tankers when needed.
He pointed out freight markets, particularly crude tanker markets, are inherently cyclical and currently influenced by geopolitical developments, trade flow shifts, and vessel supply dynamics.
Al-Subaey also expects Q2 2026 to remain influenced by geopolitical developments, particularly around key maritime routes and the Strait of Hormuz. “Freight rates and demand patterns are likely to remain volatile, and visibility remains limited given the pace at which trade flows and customer requirements can change,” he said.
The CEO further stated that freight rates are expected to moderate if conditions stabilize, while the company remains focused on operational efficiency and maximizing fleet utilization, backed by the diversification of its business and the strength of its financial position.
Below is the detailed interview:
Bahri reported net profit growth of over 300% in Q1 2026. What are your comments on the results? Are these levels sustainable for the remainder of the year? How much of the growth was driven by higher global freight rates versus increased operational activity?
Bahri delivered an exceptionally strong first quarter, with net profit increasing by 303% year-on-year (YoY) to SAR 2.15 billion. This performance reflects a combination of favorable market conditions, disciplined commercial execution, and the benefit of the fleet expansion and modernization program we have undertaken over the past period.
The largest contributor to this growth was our crude oil transportation business, where freight rates were materially higher during the quarter. However, the performance was not driven by rates alone. Our VLCC fleet, which stood at 50 vessels at the end of Q1 2026, compared to 44 vessels at the end of Q1 2025, allowed us to capture more demand and deploy owned tonnage more effectively. We also increased charter-in activity where required to meet customer needs and maintain service levels.
In terms of sustainability, we do not assume that Q1 market conditions will remain unchanged throughout the year. Freight markets, particularly crude tanker markets, are inherently cyclical and currently influenced by geopolitical developments, trade flow shifts, and vessel supply dynamics. What we believe is sustainable is Bahri’s stronger operating platform: a larger owned fleet, disciplined fleet deployment, long-standing customer relationships, and a more diversified business base across oil, chemicals, dry bulk, logistics, and marine services.
Our focus for the rest of the year will be on what we can control: safe operations, disciplined commercial decisions, cost efficiency, customer reliability, and maintaining balance sheet strength.
How did geopolitical tensions and disruptions in the Strait of Hormuz impact demand patterns and freight rates during Q1? Did they help drive the performance?
The disruption to maritime traffic through the Strait of Hormuz was a significant factor affecting market conditions during the quarter. Following the escalation of regional tensions, tanker transits through the Strait became highly disrupted, and crude flows increasingly shifted toward alternative routes, including the Red Sea corridor.
This created tighter vessel availability and a higher risk premium in the crude tanker market, which contributed to a sharp increase in quoted freight rates. It also changed customer requirements, as customers required more flexibility, faster response times, and reliable access to tonnage in a more complex operating environment.
For Bahri, the priority throughout the quarter was the safety of our people, vessels, and cargo. Despite the disruption, all owned and chartered vessels remained safe and commercially deployed throughout the period. Our ability to navigate these conditions was supported by our in-house ship management capabilities, our experienced crews and onshore teams, and our long-standing regional and international partnerships.
So yes, regional developments contributed to the stronger freight environment. However, Bahri’s performance also reflected our ability to respond operationally and commercially to those developments in a disciplined and reliable way.
The oil transport segment recorded a SAR 2.6 billion YoY increase in revenue. Was this mainly driven by higher rates or improved utilization levels?
The increase in Bahri Oil revenue was primarily driven by materially higher freight rates, but utilization and fleet scale were also important contributors.
Bahri Oil revenue rose by 241% YoY to SAR 3.74 billion, while EBITDA increased by 253% to SAR 2.12 billion. The pricing was much stronger than in Q1 2025, supported by improving supply-demand dynamics, firmer Middle East crude exports, tighter vessel availability, and the geopolitical risk premium that developed during the quarter.
At the same time, our expanded VLCC fleet played a key role.
This gave us greater capacity to serve customer demand and capture the stronger rate environment. We also increased voyage charter-in activity to meet higher customer requirements.
Therefore, the main driver was at higher freight rates which started to rise since the fourth quarter of 2025, but the scale and availability of our fleet allowed us to translate those market conditions into stronger revenue and earnings.
What is you outlook on VLCC freight rates in the coming period? Are you starting to observe any signs of normalization or stabilization?
The VLCC market remains highly volatile, and the near-term outlook depends heavily on developments around key trade routes, particularly the Strait of Hormuz, as well as broader crude export flows and vessel availability.
At the start of Q1 2026, the market was already supported by stronger fundamentals, including the gradual unwinding of OPEC+ production cuts, firmer Middle East crude exports, increased sourcing from the Atlantic Basin, and tighter vessel availability. The escalation of regional tensions then added a significant risk premium and pushed freight rates higher.
Looking ahead, if regional conditions stabilize and traffic through key maritime corridors normalizes, we could see some moderation in freight rates from the elevated levels observed during Q1. However, if uncertainty persists, rate volatility is likely to continue.
For Bahri, the priority is not to make short-term calls on rates, but to remain agile. We will continue to focus on disciplined commercial execution, flexible fleet deployment, and supporting customer requirements across changing market conditions.
How do you assess current demand for chemical shipping compared with oil transport in terms of growth and margins?
Oil transportation delivered the strongest growth in Q1, mainly because of the sharp increase in crude tanker freight rates since the fourth quarter of 2025 and the impact of regional disruption on VLCC demand.
However, Bahri Chemicals Products also delivered a strong quarter. Revenue increased 14% YoY to SAR 796 million, while EBITDA rose 42% to SAR 506 million, with EBITDA margin improving to 64% from 51% in Q1 2025. This improvement was supported by disciplined commercial execution, a continued focus on higher-margin clean petroleum products cargoes, proactive vessel deployment, and efforts to minimize off-hire days.
The chemicals and products business are different from oil transportation. It is generally more diversified across cargo types, trade lanes, and customer relationships. In Q1, the business benefited from firmer clean petroleum products market conditions and from long-term contractual relationships, including renewed COAs with Luberef and SABIC, as well as a new COA with Mitsui Co., the first concluded through our Singapore office.
Therefore, while oil was the main earnings driver in Q1, Chemicals Products remains an important contributor to Bahri’s diversification strategy and margin resilience.
Are there any expected fleet expansions or new contracts that could support growth during 2026?
Bahri’s owned fleet remained stable at 104 vessels during Q1 2026, with no additions or divestments during the quarter. However, the company has a clear newbuild orderbook that supports future growth and fleet renewal.
The orderbook includes two offshore support vessels expected in 2026, six geared Ultramax dry bulk vessels scheduled for delivery between 2028 and 2029, and two RoCon vessels scheduled for delivery in 2029. These vessels are aligned with our strategy to expand selectively into adjacent logistics and maritime services, improve fleet versatility, and support long-term earnings capacity.
From a commercial perspective, Q1 also saw important progress in strengthening long-term demand visibility. Bahri Chemicals Products renewed its COAs with Luberef and SABIC and secured a new COA with Mitsui Co. This is particularly significant as the Mitsui agreement was the first COA concluded through Bahri’s Singapore office, which strengthens our reach in East and Southeast Asia.
During 2026, we will continue to focus on maximizing the value of our existing fleet, delivering on our newbuild commitments, and pursuing selective contracts that enhance earnings quality and long-term customer relationships.
How do you view demand and freight rates in Q2 2026 amid ongoing geopolitical developments? And what are your expectations for the company’s performance in the quarter?
We expect Q2 to remain influenced by geopolitical developments, particularly around key maritime routes and the Strait of Hormuz. Freight rates and demand patterns are likely to remain volatile, and visibility remains limited given the pace at which trade flows and customer requirements can change.
That said, Bahri enters Q2 from a strong position. We have a larger owned fleet, strong customer relationships, long-term contractual coverage across key segments, and proven operational resilience. All owned and chartered vessels remained commercially deployed throughout Q1 despite regional disruption, and our priority will remain maintaining that discipline.
Q1 benefited from exceptionally strong freight conditions, particularly in crude oil transportation. If freight rates moderate, performance could normalize from Q1 levels. However, our focus remains on safely serving customers, optimizing fleet deployment, protecting margins, and managing costs and capital allocation carefully.
Our scale, integrated capabilities, and regional and international partnerships allow us to respond quickly to changing market conditions while continuing to support essential trade flows for the Kingdom and global markets.
