Iran’s ability to disrupt oil exports from the Middle East, along with its immense missile arsenal, has protected its hardline Islamic regime from military strikes.
Western leaders have avoided military intervention, despite Tehran’s support of international terror and the oppression of its own citizens, over fears that it could retaliate against its neighbors and U.S. interests in the region.
Since the February U.S. and Israeli strikes, Iran has successfully leveraged its ability to disrupt traffic through the Strait of Hormuz to cause global economic chaos and deter continued attacks, but it looks as though that power is beginning to slip.
While Iran retains the ability to escalate, its control over the Strait of Hormuz is being challenged on a daily basis, and through new tactics and increased U.S. support, ships are beginning to move.
Seven months after the war began, oil flows out of the region reached 92% of their pre-war level during the final week of September, according to Kpler data.
That does not mean the Strait of Hormuz is back to normal, or that oil flow will permanently return to normal imminently, but it does mean Iranian control is being effectively challenged under pressure from global economic demand.
Iranian forces nonetheless continue to attack commercial shipping and vessels traveling with American military support – but exporters are leveraging an elaborate system of tanker-to-tanker transfers designed to reduce the amount of time individual ships are spending inside the Gulf.
Moving, At A Cost
But the oil is getting out, albeit at a higher cost.
Reuters reported on September 28 that Middle Eastern crude exports had risen to 16.328 million barrels per day in September, the highest monthly level since the war began.
Saudi Arabia drove the recovery, increasing exports from 2.446 million barrels per day in August to roughly 5.4 million in September.
There is a new wartime oil network keeping the global economy functioning, and it looks very different from the one that existed before February – but nobody knows how long it can last.
Oil Is Moving Through Hormuz Again
While alternate routes that move oil outside of the Strait of Hormuz also exist, the changes within the strait itself are driving the recovery – but at a higher price than before.
Before February, roughly 20 million barrels of oil and petroleum products would move through the waterway every day.
Traffic then collapsed after the fighting began in February, as insurance companies hiked rates and charterers became reluctant to send ships through an active war zone.
But now, Kpler estimates that 9.9 million barrels of non-Iranian crude crossed the strait per day in September this year.
The volumes are increasing, then.
At a September 6 press conference, Energy Secretary Chris Wright said the U.S. military was helping tankers transit the waterway through daily protected convoys, and that the U.S. military presence will continue to ensure ships keep moving.
It doesn’t mean U.S. forces are sailing alongside every tanker in a traditional convoy formation, but it does mean the U.S. military presence in the region is monitoring Iranian vessels, issuing warnings, and intercepting potential threats.
The New Shuttle Tanker System
Perhaps the biggest innovation helping restore movement through the Strait of Hormuz is the shuttle tanker system, in which ships pick up crude oil cargoes outside of the Strait of Hormuz.
Shuttle tankers move the crude through the most dangerous stretches of water, willing to absorb the risk at a cost, while large tankers wait outside of the Strait and receive cargoes from other ports.
According to Kpler, at least 63 Very Large Crude Carriers (VLCCs) now operate in the shuttle trade. Vessels typically wait in safer waters near Fujairah in the United Arab Emirates or Sohar in Oman to receive cargoes.
A core fleet of 35 tankers has completed at least three round trips each, according to Kpler, with voyages typically occurring about 16 days apart.
In August, more than 70% of crude crossing Hormuz subsequently changed vessels in the Gulf of Oman.
The operation is growing, and it’s creating its own problems, with Kpler reporting on September 21 that ship-to-ship transfers in the Gulf of Oman were not approaching capacity, and support services around Fujairah and Sohar were operating near their limits.
Iran’s Leverage Weakened
Iran has not lost control of Hormuz, could still escalate, and is still disrupting traffic through Hormuz – but its ability to use the strait as an economic weapon has been weakened.
Every additional tanker that gets through the strait, or every barrel redirected around the waterway, reduces Tehran’s leverage.
But the question now is whether Iran will simply let that slide, or if it will escalate to prove that it can still raise the costs of this war.
About the Author: Jack Buckby
Jack Buckby is a British researcher and analyst specializing in defense and national security, based in New York. His work focuses on military capability, procurement, and strategic competition, and he produces and edits analysis for policy and defense audiences. He brings extensive editorial experience, with a career output spanning over 1,000 articles at National Security Journal, and has previously authored books and papers on extremism and deradicalization.
