Hormuz Exports Rebound but Refined Product Shortfalls Persist

Crude oil exports through the Strait of Hormuz have largely returned to prewar levels due to increased military escorts and pipeline redirection. According to Kpler, a firm that tracks tankers and global trade flows, crude transiting Hormuz reached a seven-day average of 13.5 million barrels per day as of Monday, matching a prewar baseline for shipments through the strait.

However, refined product supplies remain constrained, with shipments through Hormuz averaging only 677,000 bpd compared to 3.6 million bpd before the war, Kpler data showed. The global fuel supply shortfall has pushed diesel prices in the U.S. to record highs, posing a significant threat to the economy.

Iran's crude oil exports have cratered due to the US Navy blockades, with the country facing an impending loss of its main source of revenue. The US Treasury Secretary stated that Iran will make its final crude deliveries to China in about two weeks, leaving them with 'nothing left to trade for anything.'

The Gulf states are relying on a shuttle system protected by the US military to transport oil through Hormuz, but this arrangement is expensive and unsustainable in the long term. Pipelines operated by Saudi Arabia and the UAE have also increased their capacity, bypassing Hormuz and reducing reliance on the strait.