Hormuz Oil Flows Recover but Reveal a 10 Million Bpd Gap

The Hormuz oil flows are increasing rapidly, but determining how much crude oil is actually leaving the Persian Gulf has become a critical issue for banks, traders, refiners, and energy companies. Available estimates range from around 10 million to more than 23 million barrels per day (bpd), a difference that could alter perceptions of physical supply, crude oil prices, and global logistics risk. Markdown pegado

JPMorgan estimates that Middle East crude flows averaged 17.5 million bpd in September, equivalent to 98% of pre-war levels. Goldman Sachs, by contrast, estimates 23.3 million bpd of oil outflows from the Persian Gulf, including tankers operating with reduced electronic visibility.

The difference does not necessarily mean that one of the banks is wrong. From an oil economics perspective, it reveals something more important: estimates of Hormuz oil flows are not measuring exactly the same universe of barrels, nor are they necessarily using the same time windows and tracking methodologies. Markdown pegado

Hormuz Oil Flows: Why Are the Estimates So Different?

JPMorgan specifically places flows through the strait at nearly 13 million bpd, close to late-June highs and driven primarily by Saudi Arabia. However, the analysis itself warns that a higher number of crossings does not mean improved security; rather, it shows that the industry is developing the ability to operate under sustained risk.

Goldman Sachs offers a different picture. Its estimate of 23.3 million bpd corresponds to oil outflows from the Persian Gulf and includes tankers sailing in dark mode, an important variable when some vessels reduce their visibility by switching off their AIS systems.

Kpler provides another reference point. Preliminary data cited by Reuters placed crude exports from key Middle Eastern producers at approximately 12.8 million bpd during September, their highest level since the conflict began. Reuters has also warned in its maritime tracking that vessels switching off their transponders can make it more difficult to obtain full visibility of regional movements.

For this reason, placing 10, 13, 17.5, and 23.3 million bpd in the same column without explaining what each figure represents can lead to a misleading interpretation. For a company using these data to purchase crude, contract transportation, schedule refinery operations, or hedge exposure in futures markets, methodology can be almost as important as the reported volume. Markdown pegado

The Visible Barrel Becomes an Economic Variable

The discrepancy introduces a relevant concept for interpreting the current market: not every barrel physically transported has the same degree of statistical visibility. AIS makes it possible to track the position, course, and identity of vessels, but when an oil tanker reduces or interrupts that signal, maritime intelligence providers need to supplement the information with other sources and models. During periods of heightened tension, that difference can widen uncertainty between estimates.

The phenomenon had already become evident when the paralysis of the Strait of Hormuz drastically reduced maritime traffic, while certain movements could remain outside conventional records because tracking systems were deliberately switched off.

This has a direct economic consequence: the market assigns value not only to available oil, but also to the degree of certainty surrounding its location, route, and effective ability to reach the buyer. Markdown pegado

Saudi Arabia Is Changing the Hormuz Equation

The increase in Saudi exports is one of the central drivers behind the recovery of Hormuz oil flows. JPMorgan attributes the return of flows through Hormuz toward levels close to 13 million bpd primarily to Saudi Arabia. Goldman also detects a sharp increase in Saudi exports during September compared with previous levels.

But Saudi Arabia has a variable that other Gulf producers do not possess on the same scale: the ability to redirect part of its oil toward the Red Sea without passing through Hormuz.

The Saudi Arabia East West Pipeline resumed operations following the disruptions suffered in September. The infrastructure connects eastern production regions with the Red Sea coast, and Aramco is seeking to progressively restore operating capacity to around 4 million bpd.

This infrastructure introduces flexibility into the Saudi oil equation. A barrel produced in the eastern part of the country can have different logistical alternatives depending on operating conditions: it can move toward Gulf terminals and cross Hormuz or travel through the East West system toward Yanbu.

In fact, the pipeline recovery subsequently made it possible to resume loadings from Yanbu, returning an additional route for Saudi exports to the market. Markdown pegado

More Oil Does Not Automatically Mean Lower Risk

In a conventional supply and demand balance, an accelerated recovery of Hormuz oil flows should increase barrel availability and exert downward pressure on prices. However, the market is processing two signals simultaneously.

On the one hand, more barrels are available. On the other, uncertainty remains over the continuity of those flows. Reuters reported this week that Brent continued to react strongly to any change related to negotiations over Hormuz and regional disruptions. The behavior shows that the market continues to assign a premium to the possibility of new restrictions, even as the amount of oil being transported increases.

This highlights a fundamental distinction in oil economics: physical availability does not equal security of supply. A cargo may have been produced and sold, but its economic value also depends on whether it can be loaded, insured, transported, and delivered within the contractual period.

For this reason, alternative routes to the Strait of Hormuz have become increasingly important. Pipelines can divert part of the supply, but they cannot completely replace the energy volumes that normally move through the maritime corridor. Markdown pegado

Crude and Fuels Are Recovering at Different Speeds

There is another signal that deserves particular attention. JPMorgan estimates that Middle East crude flows recovered to approximately 98% of pre-war levels, but shipments of products such as gasoline and diesel reached around 3 million bpd, equivalent to only 58% of their previous levels.

This divergence is particularly relevant for refiners and industrial consumers. The normalization of crude exports does not guarantee that the fuel market has also normalized. Between the two ends of the chain are refineries, inventories, terminals, tankers, contracts, insurance, and different trade routes.

This is why feedstock supply can recover first while pressure persists on certain refined products. The market has already shown this separation. While higher Saudi volumes and new routes have relieved some of the pressure on oil, distillates continue to face specific supply constraints, a dynamic that has kept diesel prices elevated. Markdown pegado

What Should Oil Companies Watch Now?

For producers, traders, refiners, shipping companies, and industrial buyers, focusing exclusively on an aggregate export figure can obscure relevant information. The most useful indicator will be the combination of physical volume + route + visibility + logistics cost + operational continuity.

A sustainable recovery should be reflected not only in more oil tankers crossing Hormuz, but also in the normalization of refined products, greater use of alternative routes, vessel availability, lower insurance premiums, and narrower differences between tracking estimates.

LNG behavior reinforces this interpretation. Reuters detected an increase this week in visible transits of Qatar-linked vessels through Hormuz following the sharp decline observed previously, although it acknowledged that some earlier movements may not have been detected when transponders were switched off. Markdown pegado

Hormuz Shows That Knowing the Volume Is No Longer Enough

The recovery of Hormuz oil flows reduces the immediate risk of an extreme shortage, but it does not mean that the system has returned to normal conditions. The difference between estimates from JPMorgan, Goldman Sachs, Kpler, and other market participants reveals something that energy companies need to incorporate into their analysis: in markets experiencing severe disruptions, barrel visibility also acquires economic value.

For a refiner, knowing that millions of additional barrels exist is not enough. It needs to know which crude grades are available, where they can be loaded, which routes they can use, how much they cost to transport and insure, and the probability that they will arrive within the required window.

For traders and buyers, the situation is similar. A high export figure can ease expectations of scarcity, but vulnerable infrastructure or a maritime corridor exposed to risk can maintain a considerable premium on that same barrel.

For this reason, the most important signal from September is not determining which bank was right about a single figure. It is understanding that production, exports, and secure supply are three different concepts.

The Middle East can once again produce and move enormous quantities of oil. True normalization will come when those barrels can leave, be tracked, transported, and delivered to the international market with a level of risk comparable to that existing before the crisis. Markdown pegado

Primary source: Oilprice