Middle East Oil Supply Rises Sharply: What Could Happen to Crude Prices Next?

Oil shipments from the Middle East increased sharply in September, with tanker-tracking data indicating that crude flows through the Strait of Hormuz have recovered significantly from the much lower levels seen earlier in the conflict.

The increase could ease some pressure on global oil markets if the recovery continues. However, crude supply has not returned fully to prewar levels, while security risks remain around one of the world’s most important energy routes.

According to Kpler, around 10 million barrels of oil a day passed through the Strait of Hormuz in September. Another roughly 6 million barrels a day left Persian Gulf countries through ports and pipelines that bypass the strait.

Before the conflict began in late February, approximately 19 million barrels of crude a day reportedly left the region through the strait and alternative routes.

The precise numbers remain uncertain because tanker-tracking companies use different methodologies and some vessels turn off their tracking transponders.

Oil Flows Through Strait of Hormuz Recover

September’s increase represents a substantial recovery in oil shipments through the Strait of Hormuz.

Kpler’s estimate of around 10 million barrels per day remains below the roughly 16 million barrels a day that moved through the strait before the conflict, according to the figures cited in the source report.

Other tracking services have produced lower estimates.

TankerTrackers.com estimated September flows at approximately 7.4 million barrels a day, illustrating the differences between individual tracking systems.

Despite those differences, analysts cited by The New York Times said the broader trend is clear: significantly more oil is moving through the waterway than during the earlier stages of the conflict.

Why Are More Tankers Using the Strait?

One factor behind the increase appears to be greater confidence among shipping companies that tankers can travel through the waterway.

A US military operation designed to protect commercial tankers has helped support shipping activity, according to the source report. Major oil exporters, including Saudi Arabia and the United Arab Emirates, have increased shipments through the route.

Eugene Gholz, an associate professor at the University of Notre Dame who studies the conflict, said exporters are getting a substantial amount of oil out of the region and that flows have increased as shipping companies become more confident.

The improvement in tanker traffic is important because the Strait of Hormuz is a critical transit route for global energy supplies.

Oil Prices Remain Above Prewar Levels

Despite the recovery in oil shipments, crude prices have not returned to their prewar levels.

Dan Pickering, chief investment officer at Pickering Energy Partners, said the global oil market remains tight, with supply still below what the market requires.

That means an increase in Middle East exports does not automatically eliminate the supply deficit.

The September recovery is therefore best viewed as an improvement in supply conditions rather than a complete restoration of normal market flows.

Gulf Oil Exports Are Around 85% of Prewar Levels

Matt Smith, director of commodity research at Kpler, estimated that Gulf crude exports have recovered to around 85% of their prewar level.

However, Smith cautioned that the recovery does not mean the oil market has returned to normal.

Oil production still needs to increase, while refineries need to restart or raise output. Those steps depend partly on whether the security situation improves enough for tankers to move through the Strait of Hormuz without major disruption.

Why Oil-Flow Estimates Differ

Determining exactly how much crude passes through the Strait of Hormuz is difficult.

Some tankers switch off their transponders while navigating the region, making them harder to track. Analysts therefore combine multiple sources of information to estimate shipments.

These can include:

• Vessel transponder signals recorded outside the strait
• Satellite imagery
• Shipping information
• Vessel movements
• Estimates of tanker capacity and cargoes

The different methodologies explain why Kpler, Vortexa and TankerTrackers.com can produce substantially different estimates.

For August, for example, Vortexa estimated flows at 6.4 million barrels per day, compared with Kpler’s estimate of 5.9 million barrels per day and TankerTrackers.com’s estimate of 5.5 million barrels per day.

All three datasets nevertheless pointed to a significant increase from the much lower shipment levels recorded earlier in the conflict.

US Military Oil-Flow Figures Face Questions

The US military has also reported rising oil traffic through the waterway, although questions have been raised about some of the figures and the methodology used to calculate them.

Adm. Brad Cooper, head of US Central Command, said in a September 19 video that 1 billion barrels of oil had moved through the Strait of Hormuz during the previous “couple months.”

The statement prompted questions about the timeframe used.

If “couple months” were interpreted as exactly two months, the figure would imply an average of more than 16 million barrels a day—roughly corresponding to prewar daily flows through the strait.

Central Command later clarified that “the last couple” referred to a broader period of several months.

Capt. Tim Hawkins, a Central Command spokesman, said the military uses information from its own operations, shipping companies and Gulf states when calculating oil-flow estimates.

He also said that more than 13 million barrels of oil a day had passed through the strait during the two weeks preceding his comments.

Central Command rejected suggestions that its figures had been influenced by political pressure. The US Defense Department also said military personnel would continue protecting commercial vessels operating in the waterway.

Strait of Hormuz Is Still Not Considered Fully Safe

Higher oil traffic does not mean that the security risks have disappeared.

Arsenio Dominguez, secretary general of the International Maritime Organization, said the strait could not be considered open for normal navigation because the route remained unsafe.

According to figures cited by The New York Times, 85 ships had been attacked and 24 mariners had died since the conflict began.

The continued security risk means some shipping companies remain reluctant to use the route, even with US military protection.

The cost and logistical requirements of maintaining a large security operation around the waterway could also affect how sustainable the current shipping recovery is.

Alternative Oil Routes Are Also Vulnerable

The Strait of Hormuz is not the only potential point of disruption.

A major Saudi Arabian oil pipeline designed to bypass the strait was reportedly shut down after an attack during the month, demonstrating that alternative transportation routes can also be exposed to security threats.

Jim Krane, a fellow in Middle East energy studies at Rice University’s Baker Institute for Public Policy, said Iran still has several potential ways to target oil shipments and energy infrastructure.

That leaves the global oil market vulnerable even if tanker traffic through Hormuz continues to improve.

What Could Happen to Crude Prices Next?

The direction of crude prices will depend heavily on whether the September recovery in oil shipments continues.

If oil flows continue to recover

A sustained increase in tanker traffic and Gulf exports could add more physical supply to the international market.

If security risks decline and more shipping companies resume normal operations, the additional supply could reduce some of the risk premium currently embedded in crude prices.

If tanker attacks increase

The opposite scenario could quickly reverse the recent improvement.

Further attacks on commercial vessels could discourage shipping companies from using the Strait of Hormuz, reducing the volume of crude reaching international markets.

A disruption to Gulf energy infrastructure could have a similar effect.

If alternative routes remain under threat

Damage to pipelines that bypass Hormuz could further restrict the ability of Gulf producers to redirect crude around the waterway.

That would make the global market more dependent on shipping through the strait and potentially increase the sensitivity of crude prices to security developments.

September Shows Recovery, Not a Return to Normal

The September tanker data points to a substantial improvement in Middle East oil exports, but the market has not yet returned to its prewar state.

Oil flows through the Strait of Hormuz are considerably higher than they were during the earlier stages of the conflict, yet several tracking companies still estimate volumes below prewar levels.

At the same time, shipping remains exposed to security risks and the global oil market continues to face supply constraints.

For crude prices, the key question is therefore whether September’s recovery becomes a sustained trend. Continued growth in oil shipments could ease supply pressure, while renewed attacks or disruptions could quickly tighten the market again.