Oil exports exceed pre-war levels

Oil exports from the Gulf have surpassed pre-war levels despite ongoing conflicts and attacks on the Strait of Hormuz, according to data from the energy tracking company Kpler, as reported by the Wall Street Journal. During the week ending October 18, oil exports from the region exceeded 24 million barrels per day, compared to 23.3 million before the war in February.

Exports rebound after sharp decline

In mid-March, exports had collapsed to 9.71 million barrels per day, a drop of 61%, but have since increased by nearly 2.5 times. Crude oil exports from non-Iranian countries had fallen by 72% in 10 days after the conflict began, dropping to 4.5 million barrels per day at the beginning of March, but had risen to 16.5 million in September, returning to pre-war levels.

Alternative routes avoid Hormuz

Despite the ongoing attacks on the Strait of Hormuz, oil flows through the region have not fully returned to pre-war levels, with only 14 million barrels per day passing through the strait, or 82% of the pre-war level. However, producing countries have increased the use of infrastructure allowing oil to be exported without crossing the Strait of Hormuz.

Infrastructure helps bypass the strait

For example, Saudi Arabia has a pipeline connecting its main oil fields to the Red Sea, and the United Arab Emirates can transport part of their production to the Fujairah terminal on the Gulf of Oman. According to Kpler, 40% of non-Iranian crude oil exports from the region now bypass Hormuz in September, compared to only 17% before the conflict. Saudi Arabian oil shipments on the Red Sea have increased from 750,000 barrels per day before the war to 4.3 million, while those carried out in Fujairah have increased from 1.1 to 2.7 million barrels per day.

Some countries still rely on Hormuz

Kuwait, Qatar, and most of Iraq, which do not have such infrastructure, remain dependent on the Strait of Hormuz. To continue exporting oil through the Strait, transporters have organized a system of shuttles to reduce their exposure to attacks. Instead of making long trips between the Persian Gulf ports and Asian refineries, some super tankers now focus on much shorter rotations.

Shuttle system reduces risk

They enter the Gulf, load their cargo, and then cross the Strait of Hormuz, often disabling their location system. Once they have reached the waters off Oman, they transfer their oil to another ship, which is responsible for delivering it to its final destination. This system allows for multiple rotations while limiting the number of ships exposed to the dangers of the Strait. More than 70% of the crude oil that crossed Hormuz in August was transferred to another tanker off Fujairah or Oman, estimates Kpler. At least 63 super tankers are mobilized in this shuttle system, with rotations of about 16 days.

Risks remain high despite precautions

These maneuvers are not without risk. At the beginning of October, a tanker carrying two million barrels was hit by a projectile fired from a small boat. The attack pierced a freshwater tank. According to a crew member interviewed by the Wall Street Journal, the sailors had been given helmets and bulletproof vests before their second crossing. These shuttles benefit from American aerial coverage along a corridor near the Omani coast.

Protection doesn't eliminate danger

This protection, however, is not sufficient to prevent all attacks: at least 30 incidents targeting ships have been recorded since the beginning of October, according to the American newspaper. If the shipowners take such risks, it is because the potential profits have become considerable.

Profit margins drive risk-taking

According to Homayoun Falakshahi, the head of crude oil analysis at Kpler, traders can now make an additional margin of about $20 per barrel on the resale of Iraqi oil, compared to the situation before the war. For a super tanker carrying two million barrels, this represents an additional $40 million margin on a single cargo, before deducting associated costs.

High earnings attract new crews

These profits are benefiting the crews who have seen their wages soar in recent months. Some sailors are offered bonuses equivalent to two or three times their usual monthly salary to accept crossing the Strait. A Chinese maritime recruitment company has even offered up to $25,000 for a round trip of one to two weeks. Some captains even earn salaries reaching $100,000 per month.

New ships join the trade

These profit prospects have attracted new ships to the region, including aging tankers previously used to transport Russian or Venezuelan crude. However, despite the increase in oil exports, crude oil prices remain extremely high, with Brent trading around $108 per barrel compared to $72 in the last week of February before the war.

High prices reflect transport risks

The first explanation is that the markets do not react only to the amount of oil available today, but also to the risk of shortages tomorrow. An intensification of Iranian attacks, the destruction of a petroleum terminal, or an interruption of American protections could cause new disruptions. However, mainly, if the oil continues to flow, it is at the price of transport costs that have become exorbitant.

Freight costs hit record levels

According to Kpler, the cost of freight to transport crude oil from the Gulf to China aboard a super tanker reached $37.37 per barrel this week, a level close to records, or 25% of the price of a barrel compared to 5% normally. Thus, for a cargo of two million barrels, this represents nearly $75 million in transportation costs.

Insurance costs also rise sharply

Insurance has also skyrocketed. According to the maritime intelligence company Windward, war risk premiums can now reach 10% of a ship's value, compared to less than 3% previously. For a tanker valued at $100 million, a 10% premium would represent $10 million on its own. This surge in costs even affects maritime routes far from the conflict.

Global freight rates climb

The ships mobilized in the Gulf are no longer available to transport oil elsewhere in the world, which contributes to raising international freight rates. According to an analysis by Reuters published on October 19, freight costs can now represent up to 30% of the price of crude oil delivered to Asian refineries, compared to only 3 to 7% normally.

Refineries still under strain

Another difficulty is that the return of crude oil to international markets does not mean that the quantities of gasoline and diesel available have returned to pre-war levels. Oil is available, but it still needs to be transformed into fuel. However, several refineries in the Middle East have been damaged since the beginning of the conflict.

Refining capacity lags behind

According to Kpler, the volume of oil processed by the region's refineries had dropped to 7.3 million barrels per day in August, compared to 9.9 million in February. The company estimates that a return to pre-war refining capacities remains unlikely before the second quarter of 2027. To these difficulties are added the Ukrainian attacks on Russian refineries, which also disrupt global fuel supplies.

Russian fuel exports decline

These attacks had already caused a 10% decrease in Russian refinery production. The situation remains tense, with Russian diesel exports having fallen by 41% year-on-year in 2026, to about 345,000 barrels per day.