Crude oil and condensate exports from the Persian Gulf reached pre-war levels in early July, with figures ranging from 12 million to 13.6 million barrels per day, according to data from Kpler and Vortexa. This increase, a 16% rise from June, was primarily driven by higher exports from Iran, Iraq, and Saudi Arabia. However, the recovery is now threatened by escalating hostilities between the United States and Iran, which have led to a significant slowdown in traffic through the Strait of Hormuz.
Export Recovery
The analytics firm Kpler reported a daily average of 12 million barrels, while Vortexa estimated 13.6 million barrels, marking a notable recovery in oil flows from the region. Kpler analyst Johannes Rauball noted,
We’re seeing a slowdown in activity, which means that countries will have to reduce output, which decreases the amount of crude that will be shipped.
The situation has worsened recently, with reports of decreased tanker crossings in the Strait of Hormuz following Iranian strikes on vessels in the waterway.
Impact of Renewed Hostilities
As tensions rise, both Iran and the U.S. are targeting vessels in the Strait, complicating the export landscape. The renewed conflict has pushed Brent crude prices back above $90 per barrel, while West Texas Intermediate (WTI) crude was trading at $84.25 per barrel. Barclays analyst Amarpreet Singh stated that the coming days will clarify the sustainable level of oil exports from the region amid these renewed tensions. For further context, see Oil Prices Surge Amid Escalating US-Iran Conflict.
The renewed tensions in the Strait of Hormuz are likely to affect oil prices, particularly Brent and WTI, as concerns over supply disruptions grow. Investors will watch for developments in the conflict and any potential impact on shipping routes in the region.