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Yahoo
20-06-2025
- Business
- Yahoo
Addressing oil market turmoil from Iran-Israel
On 13 June, Israel launched an unprecedented wave of airstrikes on Iran, to which Tehran responded with hundreds of ballistic missiles fired at Israel. Panic ensued, reflected in prices, as benchmark Brent crude oil prices jumped 10% to over $77 a barrel by the start of the next week, amid a plethora of potential supply risks and uncertainty. The GlobalData Oil & Gas Research team addresses the main concerns and calibrates the market's potential overreaction to the Israel–Iran hostilities, looking to understand the Strait of Hormuz closure risk, the impact on Iran's oil infrastructure, the collateral effects on Egypt and Jordan, Insurance premiums and proxy escalations The likelihood of a complete closure of the Strait of Hormuz remains very low. Currently, around 30% of global seaborne oil trade and 20% of liquefied natural gas (LNG) shipments pass through this strategic chokepoint. Approximately 80% of oil and LNG exports from Gulf countries are shipped to Asian markets via the Strait, and all of Iran's oil exports to China also rely on this route. For Iran, there is no practical incentive to block the Strait, as it is an economic lifeline for the country: about 80% of its imported goods transit through this passage. Any move to close it would therefore jeopardise Iran's trade flows, as well as broader regional exports. Most of Iran's crude oil exports are shipped from Kharg Island in the Gulf. At present, the risk of a direct attack on the island appears limited, and even if targeted, such an action would likely be insufficient to halt Iran's oil exports entirely, as the island hosts multiple export terminals. Moreover, Iran has alternative export routes, including other ports such as Bandar Abbas and Bandar Mahshahr. The most notable alternative is the Jask pipeline, which bypasses the Strait of Hormuz and connects the western oil-producing regions to an export terminal on the Gulf of Oman. This pipeline was used to ship Iran's first crude cargo via Jask in October 2024. However, its export capacity is significantly lower than Kharg's terminals and does not support blended exports, so it could only serve to stabilise temporary disruptions and meet key deliveries. Iran's exports, primarily headed to China, are controlled through unofficial channels, using ship-to-ship transfers and reflagging and are unlikely to be affected by further sanctions. In fact, the escalating US-China trade tension provides a solid offtake for Iran's oil production. Egypt and Jordan are among the countries most affected by the recent escalation between Israel and Iran. On 13 October, Israel ordered the operators of the "Leviathan" and "Karish" gas fields to halt production, disrupting gas supplies to both Egypt and Jordan. In response, both countries are taking emergency measures to prevent household power outages, including the temporary shutdown of industrial facilities connected to the national grid. Egypt's fertiliser plants have been particularly hard hit. Despite the resumption of gas flows to Egypt and Jordan on Thursday, the ongoing military tensions and the risk of attacks on gas platforms in the East Mediterranean may prompt Israel to halt production again. War risk premiums have steadily been increasing globally, particularly in the Middle East. After the Israeli strikes on Iran, maritime war risk premiums saw an increase to 0.3% of vessel value, an increase of 60% from 0.125%. Further escalation, even cyber, could raise the cost of doing business throughout the Middle East. Though physical supply will remain intact, it has the possibility of driving prices upward as inflated delivered crude is supplied to Asia and Europe. The recent surge in oil prices following the Israeli attacks last Friday was primarily driven by market panic over the risk of a broader conflict and potential disruptions to regional energy supplies. This price movement does not reflect any fundamental shift in underlying market conditions. While a complete loss of Iranian oil exports remains unlikely, any supply gap could be offset relatively quickly. China currently holds elevated crude inventories, and OPEC members have the capacity and willingness to step in and increase output if needed to stabilise the market. The recent escalation of hostilities between Israel and Iran has undeniably sent shockwaves through the global oil market, evidenced by the sharp rise in Brent crude prices. However, a closer examination reveals that the fundamental dynamics of oil supply and demand remain largely intact. The likelihood of a complete closure of the Strait of Hormuz is minimal, as such an action would be economically detrimental to Iran itself. Furthermore, Iran's diverse export routes and the resilience of its oil infrastructure suggest that any disruptions to its exports may be manageable. While neighbouring countries such as Egypt and Jordan face immediate challenges due to gas supply interruptions, the broader implications for the oil market appear to be more reflective of speculative panic than of actual supply constraints. As the situation evolves, it will be crucial for stakeholders to monitor developments closely, particularly regarding insurance premiums and potential geopolitical ramifications, while recognising that OPEC's capacity to stabilise the market remains a significant mitigating factor against prolonged price volatility. For a detailed analysis of energy developments, major disruptions and comprehensive data, stay tuned to GlobalData's Oil & Gas Intelligence Center insights. "Addressing oil market turmoil from Iran-Israel" was originally created and published by Offshore Technology, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Sign in to access your portfolio
Yahoo
20-06-2025
- Business
- Yahoo
Iran Races to Get Its Oil Out Into the World
Iran is rapidly exporting oil, a sign of the unusual logistical steps that Tehran is undertaking as the US mulls joining Israel in bombing the Persian Gulf state. Satellite images of the oil storage sites at Kharg Island show that the reservoirs were only partly full on June 11, but were brimming with crude on June 18. Bloomberg's Alaric Nightingale reports.
Bloomberg
20-06-2025
- Business
- Bloomberg
Iran Races to Get Its Oil Out Into the World
Iran is rapidly exporting oil, a sign of the unusual logistical steps that Tehran is undertaking as the US mulls joining Israel in bombing the Persian Gulf state. Satellite images of the oil storage sites at Kharg Island show that the reservoirs were only partly full on June 11, but were brimming with crude on June 18. Bloomberg's Alaric Nightingale reports. (Source: Bloomberg)
Yahoo
19-06-2025
- Business
- Yahoo
Satellite Images Show Iran Racing to Get Its Oil Out
(Bloomberg) -- Iran is racing to get its oil out into the world, a sign of the unusual logistical steps that Tehran is undertaking as the US mulls joining Israel in bombing the Persian Gulf state. Security Concerns Hit Some of the World's 'Most Livable Cities' JFK AirTrain Cuts Fares 50% This Summer to Lure Riders Off Roads Taser-Maker Axon Triggers a NIMBY Backlash in its Hometown How E-Scooters Conquered (Most of) Europe NYC Congestion Toll Cuts Manhattan Gridlock by 25%, RPA Reports Oil is gushing out of the nation's ports and onto ocean-tankers, ensuring revenues would continue — at least for a while — if shipments are disrupted. Despite the surge, storage tanks at the nation's critical export terminal at Kharg Island are brimming with crude. Traders and investors are parsing every piece of data available to understand how oil from the Islamic Republic and the wider Gulf region will be affected as Israel pounds the country's nuclear sites, military and wider energy infrastructure. Satellite data offer at least part of the answer when it comes to Iran. Storage Tanks The oil storage sites at Kharg Island have floating roofs that rise and fall as they empty and fill, meaning it's possible to get clues from above as to just how much they're holding by examining their shadows. And what images from June 11 show is that, for almost all of the large tanks, the roofs were well below the top of the walls. In short, the reservoirs were only partly full. Fast forward by a week, and a photo from June 18, several days after Israel began its attacks, shows there are no such shadows, indicating that the roofs are now at the top of the walls and the reservoirs are brimming. There are still shadows cast by the tanks onto the ground beside them, confirming that the absence isn't due to a lack of sunshine. The images were taken less than 10 minutes apart at about 2:40 pm local time on their respective days with nearly the same sensor geometry. Samir Madani, co-founder of a firm that specializes in monitoring the clandestine oil trade of Iran and other nations using satellite imagery, confirmed that he also saw ' a rise in crude inventories at the island.' That's not what you'd expect, given that Iran has been driving up its exports. If the exports are well above normal, then storage tanks should be emptying — unless Iran is also directing even more crude into the facility. The inference, then, is that Iran is sending as much as possible to the global market while it can. Iran can store about 28 million barrels of crude at Kharg, according to a 2024 report from S&P Global Commodity Insights. Refurbishment of two 1 million barrel tanks was completed last month, but it's unclear whether they were included in the earlier capacity figure. Export Flows Iran's oil exports have spiked since the nation came under attack from Israel on Friday, according to Madani. It exported an average of 2.33 million barrels a day in the five days the attacks began June 13, according to data from That's an increase of 44% compared with the average for the year through to June 14. 'It seems very clear what they're doing,' Madani said of Iran's approach. 'They're trying to get out as many barrels they can but with safety as their number one priority.' Oil is held in closely packed storage tanks at Kharg, making it more vulnerable to attack than cargoes on ships dotted around the Persian Gulf or heading for China. Dispersed Tankers In another sign of Tehran's logistical response, vessels are staying far away from Kharg until the last possible moment before dashing to the terminal to load and spending as little time as possible at the terminal. Satellite imagery from Planet Labs from June 11, a few days before the first Israeli attack, shows tankers, most of them very large crude carriers, each able to hold about 2 million barrels, anchored in the sheltered waters between Kharg Island and the Iranian mainland. Comparison with earlier images shows this to be well within the normal range for the number of ships anchored there. In a second image, taken on June 17, four days after the first missiles hit Iran, all of the vessels have dispersed, leaving none at the anchorage sites near the island. The photos above show only the core area of the anchorage for visual clarity. They do not include tankers anchored further from the island. Iran adopted a similar strategy of dispersing waiting tankers when it previously came under Israeli attack in October. Then, too, it kept exports running without interruption. Ken Griffin on Trump, Harvard and Why Novice Investors Won't Beat the Pros Is Mark Cuban the Loudmouth Billionaire that Democrats Need for 2028? The US Has More Copper Than China But No Way to Refine All of It How a Tiny Middleman Could Access Two-Factor Login Codes From Tech Giants Can 'MAMUWT' Be to Musk What 'TACO' Is to Trump? ©2025 Bloomberg L.P.
Bloomberg
19-06-2025
- Business
- Bloomberg
Satellite Images Show Iran Racing to Get Its Oil Out
Iran is racing to get its oil out into the world, a sign of the unusual logistical steps that Tehran is undertaking as the US mulls joining Israel in bombing the Persian Gulf state. Oil is gushing out of the nation's ports and onto ocean-tankers, ensuring revenues would continue — at least for a while — if shipments are disrupted. Despite the surge, storage tanks at the nation's critical export terminal at Kharg Island are brimming with crude.
