US Naval Blockade Crimps Iran's Oil Exports, Stocks Piled Up

A US naval blockade has significantly reduced Iran's oil exports, forcing crude onto floating storage vessels. The blockade, which began on February 28, has resulted in a sharp decline in Iranian crude shipments from the Gulf of Oman, with just a handful of carriers leaving the area between April 13-25, according to data from Vortexa.

This represents an 80% drop from the comparable period in March, when Iran exported 23.4 million barrels, LSEG data shows. Some Iranian vessels have been intercepted by US forces after leaving Iranian ports, along with sanctioned container ships and tankers in Asian waters.

The loss of Iranian supply adds to wider market tightness as the war has effectively closed the Strait of Hormuz, curtailing oil exports from Saudi Arabia, the UAE, Kuwait, and Iraq. Benchmark Brent crude oil futures have jumped by about $50 a barrel since the Iran war began on February 28.

The International Energy Agency has described it as the world's largest oil output disruption. US authorities said their blockade is denying Tehran of much-needed revenue from crude exports, with at least 41 tankers carrying 69 million barrels of Iranian oil that cannot be sold.