According to WPB, Middle Eastern oil flows have climbed above their pre-war level for the first time on a weekly basis, despite continued attacks on commercial shipping around the Strait of Hormuz and exceptionally high tanker and insurance costs. Ship-tracking data show that oil movements through Hormuz and alternative export routes averaged more than 24 million barrels per day in the week through October 18, exceeding the approximately 23.3 million bpd recorded before the war.
The headline, however, does not mean the Strait of Hormuz itself has returned to normal. Preliminary data put oil flows through Hormuz, including offshore transfers in the Gulf of Oman, at roughly 14 million bpd during the same week, equivalent to about 82% of the pre-war level. The difference is being made up by a fundamentally altered export system that relies much more heavily on pipelines, terminals outside the strait, short-distance shuttle tankers, and ship-to-ship transfers.
That distinction is the central market signal. The Middle East has restored overall oil export capacity faster than it has restored normal shipping conditions through its most important maritime chokepoint. Physical volumes have recovered, but the route structure, vessel requirements, insurance environment, and cost of moving each barrel remain very different from the market that existed before the conflict.
Saudi Arabia and the United Arab Emirates have played a major role in this adjustment by expanding the use of export routes that bypass Hormuz. In September, approximately 40% of non-Iranian Gulf crude left the region without crossing the strait, compared with only about 17% before the war. Saudi barrels have increasingly moved west through the East-West Pipeline toward Red Sea terminals, while the UAE has relied more heavily on its pipeline connection to Fujairah on the Gulf of Oman.
The crude that still crosses Hormuz is also being moved differently. A large share now travels on shuttle tankers that make repeated short voyages between loading terminals inside the Gulf and transfer points outside the most exposed area. In August, more than 70% of crude crossing the strait changed tankers offshore near Fujairah or Sohar. These transfers allow long-haul vessels to avoid repeatedly entering the highest-risk section of the route, while dedicated shuttle ships take on more of the dangerous Gulf transit.
This system has become increasingly organized, but it is not equivalent to normal trade. Shuttle operations require more vessels to move the same barrel from producer to final buyer, increase ship-to-ship handling, extend the number of operational steps in each cargo movement, and concentrate risk on the vessels that repeatedly enter the Gulf. The resulting structure can maintain export volumes, but only at substantially higher logistical cost.
Security conditions remain severe. Around 30 attacks on vessels had been reported during October by the time the latest data were compiled, showing that the recovery in oil flows has occurred alongside continuing maritime threats rather than because those threats have disappeared. Tankers are still operating through a market characterized by security personnel, altered transit procedures, high crew incentives, changes in vessel deployment, and significantly higher insurance exposure.
The financial cost of maintaining these flows illustrates the difference between volume recovery and logistics normalization. Freight for a supertanker carrying Gulf crude to China has approached approximately $37.37 per barrel, while war-risk insurance in some cases has risen to as much as 10% of a vessel’s value from less than 3% previously. Oil is therefore moving at or above pre-war aggregate volumes, but the cost structure required to sustain those movements remains extraordinary.
This helps explain why the latest export data do not contradict the severe pressure Asian refiners are experiencing. Higher regional flows increase the physical availability of crude, but they do not remove the freight and insurance burden attached to that supply. In some Asian cargoes, shipping and insurance costs have risen to as much as 30% of delivered crude cost, meaning a refinery can receive the barrel while still facing heavily compressed economics.
The recovery is also uneven across the petroleum chain. Middle Eastern refined-product exports remained around 1.9 million bpd in September, compared with approximately 4.7 million bpd before the war. That gap is critical because it shows that the region’s crude-export system has recovered much faster than its refinery and product-export system. More crude leaving the Middle East does not mean an equivalent recovery in diesel, gasoline, fuel oil, or other refinery products.
For the bitumen market, this distinction is particularly important. Bitumen is a refinery product whose availability depends on refinery throughput, crude quality, residue yields, upgrading configuration, alternative values for heavy streams, and local demand. A rise in regional oil exports above pre-war levels therefore cannot be interpreted as evidence that bitumen production or bitumen exports have also exceeded their earlier levels.
The most direct positive implication is for crude feedstock availability. If importing refineries in Asia can obtain more Middle Eastern crude despite the security disruption, they face less physical risk of feedstock shortage than during the earlier phase of the crisis. That can support refinery operating continuity where transportation remains commercially viable, which in turn can stabilize the availability of vacuum residue and other heavy streams from which road bitumen may be produced.
However, continuity of crude supply is only one part of the equation. A refinery receiving expensive crude through a high-cost shipping system may still reduce operating rates, change its crude slate, prioritize higher-margin products, or divert heavy residue toward fuel oil and conversion units rather than bitumen. The economics of processing the barrel therefore remain as important as the physical arrival of the barrel.
The composition of the incoming crude also matters. Different crude grades generate different proportions and qualities of vacuum residue, so a refinery replacing one traditional Gulf crude with another source cannot assume that the same bitumen yield or binder characteristics will follow. A recovery in total crude volumes can therefore coexist with changes in bitumen availability or formulation requirements at individual plants.
The lag in refined-product exports provides another reason for caution. Regional crude can move through pipelines and large tanker systems that are not available to finished bitumen. Bulk bitumen requires specialized heated storage, loading infrastructure, and temperature-controlled vessels, while packed material depends on container availability, port handling, and inland distribution. The logistics network that has restored crude exports is therefore not automatically a substitute for disrupted bitumen supply chains.
In fact, the recovery may reinforce the growing importance of distinguishing between crude logistics and bitumen logistics. A VLCC can carry around two million barrels of crude and participate in a shuttle or offshore-transfer system, but it cannot simply switch to transporting bulk bitumen. The heated tanker fleet is much smaller and more specialized, meaning bitumen freight can remain tight even when crude tanker availability improves.
For regional bitumen exporters, high marine-fuel costs, war-risk premiums, voyage delays, and vessel availability remain central to delivered pricing. A producer may have sufficient refinery output and an attractive FOB price, but the cargo can still become uncompetitive after freight and insurance are included. The latest Middle East data therefore strengthen the case for evaluating bitumen on a delivered-cost basis rather than interpreting crude-export recovery as an automatic reduction in supply risk.
The new export structure also has important implications for geography. Fujairah, Sohar, and Red Sea terminals have become more important as oil is redirected around the most constrained sections of Hormuz. For petroleum traders broadly, infrastructure outside the strait now carries greater strategic value because it can separate production risk from chokepoint risk. For bitumen, however, the relevance of each location depends on whether suitable heated storage, loading, packaging, and vessel infrastructure is actually available.
The weekly nature of the 24 million bpd figure must also be kept in perspective. It represents an average for the week through October 18 and should not yet be treated as evidence that exports can be sustained permanently above the pre-war baseline. Earlier weeks have shown substantial volatility as attacks, route disruptions, vessel availability, and terminal operations changed rapidly. The durability of the recovery will therefore depend on whether the new transport system can maintain similar volumes over a longer period.
A renewed escalation could expose the weaknesses of the current structure. Greater reliance on shuttle fleets and offshore transfers creates redundancy in some areas but also introduces additional operational points that can be disrupted. Pipelines provide alternatives to Hormuz, but their capacities are finite, and other export routes introduce exposure to the Red Sea and Bab el-Mandeb security environment.
The latest data therefore mark a major improvement in physical oil movement, but not a return to the old market. The Middle East has effectively rebuilt its export system around a combination of bypass pipelines, alternative terminals, shuttle tankers, offshore transfers, and protected maritime corridors. That system is now capable of moving more than 24 million barrels per day, yet it does so with higher cost, greater complexity, and substantially more security risk than before the war.
For the refinery and bitumen sectors, the most useful conclusion is that supply volume and supply normalization are no longer the same thing. Crude availability has recovered faster than shipping safety, refinery-product exports, or transport economics. That means headline export figures alone cannot determine the direction of bitumen availability or pricing.
The next indicators to watch are therefore not only total Middle Eastern oil flows, but also refinery utilization, refined-product exports, vacuum-residue economics, heated-tanker availability, war-risk insurance, and the spread between FOB and delivered bitumen prices. If crude flows remain above pre-war levels while freight begins to normalize, pressure on refinery economics could ease considerably. If freight and security costs remain elevated, however, the region may continue moving record volumes while the downstream market remains constrained.
The latest data capture that contradiction clearly: more oil is leaving the Middle East than before the war, but only about 82% of pre-war Hormuz flows have returned. The recovery has come through a new and far more expensive logistics system, not through restoration of the old one. For bitumen traders and refiners, that difference matters more than the headline 24 million barrels per day.
By WPB
Middle East oil exports, Strait of Hormuz, Gulf oil flows, crude oil shipping, alternative oil routes, tanker freight, war-risk insurance, Saudi oil pipeline, Fujairah pipeline, Gulf of Oman, ship-to-ship transfer, refinery economics, refined product exports, bitumen supply, bitumen shipping, vacuum residue, heated bitumen tanker, petroleum logistics
