Oil Prices Stay Below $100 Amid Ongoing Middle East Tensions

Global oil benchmark Brent crude has rallied in recent weeks but remains below $100 a barrel despite ongoing tensions between the US and Iran, which have disrupted Gulf exports through the Strait of Hormuz and the Red Sea.

Roughly 11 million barrels per day (bpd) of crude oil shipments from Middle East producers currently flow through these waterways, down from 18 million bpd before the conflict escalated seven months ago, according to Argus.

Despite this reduction in supply, industry estimates suggest daily exports are still between 6 and 8 million barrels. Some Gulf producers have found alternative routes for their oil shipments, which has mitigated some of the earlier shortfall.

However, Iran's oil exports have plummeted due to a US blockade, while top importer China has also reduced its seaborne crude shipments in response to rising transport electrification and coal-based chemicals. Beijing's vast reserves, estimated at 1.17 billion barrels, have given markets some comfort.