(Seoul = Yonhap News) Reporter Lee Ji-heon = Crude oil exports from the Middle East have recently almost recovered to the normal level before the outbreak of the US-Iran war, CNN reported on the 29th (local time), citing a Wall Street report.
According to reports, JP Morgan's global raw materials research team led by Natanya Kaneva estimated in a recent report that Middle East crude oil exports amount to an average of 17.5 million barrels per day.
JP Morgan explained that this is a figure estimated by adding up all crude oil exports through the Gulf Sea (Persian Gulf) and the Red Sea, and is equivalent to 98% of the pre-war volume.
Energy transport through the Strait of Hormuz has also recovered to a significant level.
Kepler, a maritime information company, analyzed that the volume of crude oil and petroleum products transported through the Strait of Hormuz last week averaged 13.1 million barrels per day.
Considering that the daily transportation volume before the war was 17.1 million barrels, crude oil transportation through the strait is interpreted to have recovered to 77% of normal levels.
“Given the large volume of shipping passing through the strait, it appears that Iran is currently losing control of the strait,” said Matt Smith, director of raw materials research at Kepler.
Analysis suggests that the significant recovery in crude oil exports from the Middle East is due to the effectiveness of the 'crude oil shuttle service', which has emerged as an emergency transportation method.
The crude oil shuttle service refers to a method in which an oil tanker loaded with crude oil or refined oil sneaks out of the Strait of Hormuz under Iranian surveillance under the escort of the U.S. military and then supplies export volume through ship-to-ship transfer in relatively safe waters.
This is a direct use of the maritime ship-to-ship transshipment technique that Iran and Russia have secretly used to avoid sanctions.
Abu Dhabi National Oil Company (ADNOC) in the United Arab Emirates (UAE) has been operating a crude oil shuttle service since last April, and Saudi Arabia, the largest oil exporter, recently expanded this method.
Saudi Arabia has restarted the oil pipeline, which had been shut down due to an unmanned aerial vehicle (drone) attack, and has resumed crude oil exports through Yanbu Port on the Red Sea coast.
On the 11th, Saudi Arabia completely suspended oil pipeline operations and crude oil exports from Yanbu Port after receiving a drone attack believed to have been carried out by pro-Iranian militias in Iraq.
As crude oil exports using shuttle ships continued, supply concerns eased with news of Saudi Arabia's resumption of Red Sea crude oil exports, and U.S. West Texas Intermediate (WTI) futures plunged 3.5% on the 29th.
The recovery of crude oil transport from the Middle East is expected to act as a factor weakening Iran's negotiating power, which seeks to use control of the Strait of Hormuz as leverage in negotiations.
While U.S. President Donald Trump rejected the '7-day plan' proposed by Iran, U.S. and Iranian officials continued indirect talks on the 28th and 29th to restore the end-of-war negotiations and reopen the Strait of Hormuz under Qatar's mediation.
Previously, last week, Iran proposed the following demands to the United States: lifting the maritime blockade against Iran, lifting frozen funds, exempting crude oil sanctions, and stopping hostilities on all fronts, including Lebanon. Iran's position is that if the United States implements this, the Strait of Hormuz can be reopened within 7 days.
In an interview with U.S. media outlet Axios, President Trump said of Iran's proposal, "It's not the agreement I want," and said, "It's an overreach."
Meanwhile, it is pointed out that the use of shuttle ships escorted by the US military is expensive and risky, so it is only being used as a temporary alternative and has long-term limitations.
Another cause for concern is the fact that the oil market's supply and demand is largely dependent on the release of the Strategic Petroleum Reserve (SPR) to cover the global crude oil supply shortage.
The U.S. strategic oil reserve inventory has fallen to less than 284 million barrels, the lowest level in 44 years since 1982.
The fact that the volume of petroleum products transported is still below the pre-war normal level is also a factor in keeping the prices of refined oils such as diesel oil high.
JP Morgan estimated that exports of refined petroleum products from the Middle East remain at about 58% of pre-war levels.
According to the American Automobile Association (AAA), as of the 29th, the average price of diesel in the United States was $6.44 per gallon, up $2.75 from a year ago.
