Crude oil exports from Gulf countries have reached 80% of pre-war levels. This change in export status occurs while Brent crude oil prices remain above $100 per barrel, and concerns about transportation costs and the risk of escalating attacks in the oil market persist.
Impact of Oil Prices on the Market
Brent crude oil prices are considered an important benchmark for the success or failure of political decisions in the energy sector. In this situation, keeping oil prices below the $100 mark is interpreted as beneficial for U.S. President Donald Trump. Conversely, crossing this threshold could be detrimental to him. These changes can have psychological effects on investor behavior and lead to an increase in futures contract purchases.
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Oil Export Status and Challenges
Before the war began on February 28, Gulf countries, except Iran, were exporting 17 million barrels of crude oil daily. However, with the onset of hostilities, oil exports sharply declined, reaching 25% of normal levels at the peak of the crisis in mid-March. Last week, according to Vortexa data, crude oil shipments reached their highest level in six months at 14 million barrels per day.
Despite this increase, the oil market faces new challenges. The shortage of refined products, especially diesel, remains persistent, and transporting these products is more expensive than moving crude oil. Additionally, many Gulf refineries that were targeted in the early days of the war have not yet returned to full operation.
Trump's performance in these circumstances reflects his resilience against economic pressures and willingness to endure more hardships to compel Iran to cooperate. If Iran comes to the negotiating table, prices could drop significantly, but an increase in attacks on energy infrastructure could also drive oil prices higher.
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