Middle East oil exports exceed pre-war levels despite Strait of Hormuz attacks

Middle East oil exports hit levels not seen since before the war in September, despite rising attacks on tankers in the Strait of Hormuz. Data from Kpler and Vortexa revealed that crude exports from the region averaged 18.3 million barrels per day (bpd) by the end of September, surpassing pre-war levels on 14 days that month. This surge in exports was driven by Saudi Arabia and Iraq, which increased shipments despite the risks. Saudi Arabia loaded cargoes from both the Red Sea and the Gulf, while Iraq secured permission from Iran for its tankers to pass through Hormuz.

The export surge has helped ease market tightness, particularly for Asian refiners. Xavier Tang, a senior market analyst, noted that Saudi Arabia is ramping up exports to regain market share. Meanwhile, liquefied natural gas (LNG) cargoes exiting the strait also rose to their highest levels since February. However, the surge in traffic has come with increased risks, as Marisks, a shipping intelligence service, warned of a heightened threat to merchant ships transiting the Strait of Hormuz.

At least seven tanker attacks were reported in the past week alone. The very large crude carrier (VLCC) Kazimah III was struck on October 1, causing a fire onboard, while the Aframax tanker Lipsi was hit on October 4, damaging its engine room. The UK Maritime Trade Operations agency reported daily attacks in the Strait of Hormuz or the Gulf of Aden since October 2. Marisks suggested that Iranian forces may be launching missiles into predetermined engagement areas rather than targeting specific vessels.

Before the war began on February 28, the strait typically handled about 125 large commercial vessels per day, accounting for 20% of global crude and LNG supply. The current situation highlights the delicate balance between meeting global energy demand and navigating the volatile security landscape in the region.