Daily oil exports from the Middle Eastern Gulf, home to top exporter Saudi Arabia and other major producers, have dropped by at least 60% in the week to March 15 compared to February due to disruptions and output cuts amid the U.S.-Iran war, according to shipping data and Reuters calculations.
The effective closure of the Strait of Hormuz, normally used to transport about a fifth of the world’s oil supply, has forced exporters to cancel shipments and shut production at oilfields, creating the world’s biggest ever supply disruption. Crude oil prices have surged to the highest in four years and those of some fuels to record highs.
Crude, condensate and refined fuels exports from eight Middle Eastern countries – Saudi Arabia, Kuwait, Iran, Iraq, Oman, Qatar, Bahrain, and the United Arab Emirates – in the week to March 15 averaged 9.71 million barrels per day, data from Kpler showed, down 61% from 25.13 million bpd in February.
Data from Vortexa shows an even more dramatic drop, with exports from the eight countries last week reaching 7.5 million bpd, down 71% from February’s 26.1 million bpd.
Prior to the war, the eight countries accounted for 36% or global seaborne oil exports of 70.43 million bpd, according to Kpler.
The actual exports could be even lower as some volumes go into floating storage but not leaving the Gulf.
“Floating storage of Middle Eastern crude has surpassed 50 million barrels this week, up from pre-war levels of around 10 million barrels,” Kpler analyst Johannes Rauball said. Loadings from the UAE’s Fujairah port have been disrupted in the past few days due to drone attacks. Oil flows that are continuing include exports from Saudi Arabia’s Red Sea port of Yanbu, Iran’s exports, Oman’s exports and the UAE’s flows from Fujairah.
Total oil output cuts from Middle East producers have risen as the countries run out of storage and traffic through Hormuz remains a fraction of normal levels. Oil output in the United Arab Emirates, which pumped about 3.4 million bpd before the conflict, is down by more than half, Reuters reported on Monday. Saudi Arabia has cut production by 20%, and Iraq by some 70%. Total crude oil output cuts in the Middle East now stand at 7-10 million bpd, according to analysts’ estimates.
(Reporting by Ahmad Ghaddar and Alex Lawler, Editing by nick zieminski)