Goldman: Hormuz Oil Flows Likely to Recover Only 70% Post-War
Oil flows through the Strait of Hormuz are expected to recover to just about 70% of pre-war levels, according to Goldman Sachs Group Inc., highlighting how regional producers are increasingly relying on alternative routes to maintain supply.
“Normalization of Gulf exports to pre-war levels might be achieved with a 13 million barrels per day increase in Hormuz flows from current levels,” analysts including Yulia Zhestkova Grigsby wrote in a June 17 note titled “70% of Pre-War Hormuz Flows Might Become the New 100%.” The pickup in shipments is expected to be completed by the end of next month, with Gulf production likely recovering by October. Prior to the conflict, approximately 20 million barrels of oil and products passed through the strait daily, according to the International Energy Agency (IEA).
An interim peace deal signed by U.S. President Donald Trump and Iran aims to end the war and reopen the Strait of Hormuz. During the conflict, shipments through the trade artery fell dramatically due to dual blockades by Tehran and Washington, temporarily pushing crude prices higher. Regional producers, including Saudi Arabia, the United Arab Emirates, and Iraq, have increasingly relied on alternative pipelines and ports, such as the Red Sea coast, Fujairah, and Ceyhan, to sustain vital energy flows to global markets.
Currently, visible flows through Hormuz are estimated at around 1.3 million barrels per day, with an additional 1.6 million barrels from the Gulf of Oman likely related to unofficial routes (dark crossings). Meanwhile, 7.5 million barrels per day move through Yanbu, Fujairah, and Ceyhan. Goldman analysts note that vessel availability is unlikely to constrain the recovery, although some shipowners remain reluctant to transit the strait.
The UAE is developing its eastern ports along the Gulf of Oman, including Dibba, Fujairah, and Khor Fakkan, to reduce dependency on Hormuz. “We are moving toward zero Hormuz dependency, regardless of whether it’s open or not,” said UAE Minister of Foreign Trade Thani Al Zeyoudi. Kuwait is also exploring alternative pipeline routes and working with Saudi Arabia and the UAE to expand their pipeline networks to handle Kuwaiti oil exports.
Source : Newsmaker.id
