Crude exports from the Strait of Hormuz have largely returned to levels seen before the outbreak of war with Iran, as oil producers and the shipping industry have found alternative ways to transport crucial fuel out of the Middle East. Pipeline exports and ship-to-ship transfers are among the methods being used, according to analysts monitoring the situation, as the US military continues to escort some ships. However, flows of refined products such as diesel remain limited, driving up prices. At least 16.5 million barrels per day (bpd) left the region in September, according to figures from global trade intelligence firm Kpler, matching the pre-war average, excluding Iran. The figure is 10.5 million bpd higher than the monthly average in March, during the first weeks of the Iran war. A chart comparing oil transits through the Strait of Hormuz with other Gulf routes. Since the conflict began on February 28 with US and Israeli attacks on Iran, Tehran has sought to assert its authority in the Strait of Hormuz and at times even declared the strategic waterway closed. However, Iran’s grip appears to have eased in recent weeks, as oil exporters have found solutions to address the disruption. About 40% of the region’s crude oil is now transported without transiting the strait, compared with just 17% before the war, via Saudi and Emirati pipelines, according to Kpler’s analysis. Saudi Arabia was able to restart operations on its east-west oil pipeline in late September after it was damaged during drone attacks, allowing exports to resume from the Red Sea port of Yanbu. In a sign of the other adaptations, most of the crude oil transported through the Strait of Hormuz is transported on a ferry fleet made up mainly of large crude oil carriers, which sail with their satellite transponders turned off. The cargo is moved to different tankers in open waters, usually off the coast of Oman or Fujairah in the United Arab Emirates. Tankers and merchant ships anchor off Fujairah. Ship-to-ship transfers are among the methods used to transport oil. Photograph: Barry Iverson/Alamy More than 70% of the crude oil that passed through the strait in August changed tankers, while before the war almost no Gulf crude oil changed vessels in the Gulf of Oman. However, the region’s export recovery remains unbalanced and the supply of refined products remains limited. This poses a problem for businesses and households that rely on refined products such as diesel to power their cars, vans and trucks. “Diesel carries the greatest risk,” said Kpler analysts, who found that less than 20% of refined product levels shipped through Hormuz before the war were transported. promotionThe average price of diesel in the UK hit an all-time high of 199.18 liters pa on Monday. Photograph: Jacob King/PAThey recorded a seven-day average of 677,000 bpd of refined products through Monday, compared to 3.6 million before the conflict. Even as the region’s oil exports have increased, the threat level to ships operating around the Strait of Hormuz has not gone away. the editor-in-chief of shipping publication Lloyd’s List. “Oil flows have recovered because market participants have accepted greater operational complexity and higher costs. The underlying threat remains.” $100 a barrel on Thursday, up 3% to $101. The rise came after reports that China had suspended exports of petroleum products to regions beyond Hong Kong and Macau, a move that would add further pressure to oil markets. Oil analysts said China’s decision could suggest it was concerned about the availability of domestic products.
