Saudi oil roars back despite Hormuz shipping slump as tankers brave Iran threats

Saudi Arabia has exported an estimated 34 million barrels of crude oil through the Strait of Hormuz since the June 17 ceasefire, underscoring a faster-than-expected recovery in Gulf oil flows even as commercial shipping through one of the world's most critical maritime chokepoints remains far below normal levels.

Cargo-tracking firm Kpler estimates Saudi shipments have rebounded strongly despite continued disruptions to commercial navigation.

Data from the IMF PortWatch platform shows only about 27 commercial vessels per day have transited the Strait of Hormuz with active Automatic Identification System (AIS) signals since the ceasefire.

That is roughly one-third of the pre-war average of about 84 daily transits.

The uneven recovery highlights a widening gap between energy exports and broader commercial shipping as Gulf producers restore crude deliveries while many private shipowners remain wary of security risks in the region.

On July 4, PortWatch recorded just 25 AIS-visible vessel crossings through the strait.

At the same time, Bloomberg reported that four outbound oil tankers reversed course after receiving radio warnings from Iran's Islamic Revolutionary Guard Corps (IRGC), underscoring persistent security concerns despite the ceasefire.

Industry analysts say much of the crude now moving through Hormuz is being transported by state-backed tanker fleets, vessels operating under sovereign insurance programmes, or ships that limit or temporarily disable AIS transmissions for security reasons.

By contrast, many independent tanker operators continue to avoid the route because war-risk insurance premiums remain about eight times higher than before the conflict, significantly increasing operating costs for commercial carriers.

The recovery has favoured major Gulf oil exporters.

Saudi Arabia has steadily increased exports since hostilities subsided, while the United Arab Emirates has accelerated production and expanded shipments to Asian customers following its departure from OPEC, allowing additional Gulf crude to return to global markets.

The UAE is restoring crude oil exports to near-record levels following disruption caused by the recent regional conflict, with alternative export routes and infrastructure helping maintain supplies to rest of the world.

The Strait of Hormuz, located between Iran and Oman, remains the world's most important oil transit route, carrying roughly one-fifth of global petroleum consumption under normal conditions.

The waterway became the focal point of regional tensions earlier this year after conflict involving Iran disrupted commercial shipping and temporarily drove global oil prices sharply higher.

Although the ceasefire has eased fears of a prolonged supply shock, maritime security experts say shipping activity is likely to recover more slowly than oil exports until insurers, shipowners and commercial operators regain confidence that vessels can safely navigate the strategic waterway.