Iraq's oil exports through the Strait of Hormuz have rebounded, but are still far from pre-war levels

(1) The director of the Iraq Oil Marketing Company stated that this month, oil exports through the Strait of Hormuz have risen to approximately 2 million barrels per day, recovering somewhat from the early months of the conflict, but still below the pre-war total export volume of about 3.4 million barrels per day. (2) Abu Dhabi National Oil Company’s trading division has been reported to be supplying Iraqi crude to Asian buyers by transshipping cargoes through the Strait of Hormuz. This method typically involves tankers turning off their transponders to avoid monitoring and has become one of the ways to maintain Middle Eastern oil flows to global markets under current circumstances. (3) Major Abu Dhabi energy companies have been listed among firms purchasing Iraqi crude and shipping it through this route. The involvement of traders indicates that, as formal export channels are restricted, third-party logistics arrangements are filling some of the gap. (4) Although the daily export volume of around 2 million barrels has recovered somewhat from the lowest point, it remains significantly below pre-war levels. The gap of about 1.4 million barrels per day reflects the ongoing constraint on Iraq’s crude oil export capacity caused by limited transit through the Strait of Hormuz. (5) While transporting goods with transponders turned off can maintain some flow in the short term, it increases shipping safety risks and insurance costs and cannot massively replace the transport capacity under normal passage conditions through the strait. (6) Further attention will be paid to whether Iraq can increase exports via alternative routes and whether the situation in the strait undergoes any phased changes. This will determine the timeframe for Iraq’s oil exports to return to pre-war levels.