Middle East Oil Producers Use Workarounds to Keep Crude Flowing

Oil producers in the Middle East have found a workaround to keep crude oil flowing despite Iran's threats and attacks on shipping in the Strait of Hormuz. The ship-to-ship transfer method involves shuttle tankers carrying crude from the Persian Gulf across the riskiest stretch of the strait, then handing it off to waiting buyer vessels in the Gulf of Oman.

According to Goldman Sachs, this adaptation signals that markets are pricing in disruptions continuing well into 2027. The firm estimates that Gulf exports of oil and products have reached roughly 15 to 16 million barrels a day, which is still below pre-war levels but above the March trough.

The US Energy Secretary Chris Wright said American naval support has helped move over 15 million barrels of oil and products out of the strait. Total regional exports, including pipelines, are closer to 20 million barrels per day, with a seven-day average of more than 8 million barrels a day leaving the strait itself.

Despite the improving flow picture, fighting flared around the strait over the weekend, pushing WTI and Brent futures up nearly 3%. Refining margins have climbed to records as the supply bottleneck shifts downstream to refining capacity.