Pre-conflict export levels
Analysts at Kpler and Vortexa told Reuters the rebound was driven by the resumption of shipping through the Strait of Hormuz, higher UAE crude production and exports, and the release of stored inventories, lifting shipments above pre-conflict levels.
“The rise can be attributed to multiple factors, including a resumption in flows via the Strait of Hormuz, helping to free trapped vessels,” said Kpler senior oil analyst Johannes Rauball.
“At the same time, we have been observing a ramp up in supply from the UAE, which we estimate is closing in on pre-war levels.” Rauball added that the UAE has also been drawing down part of its commercial inventories, helping keep export volumes elevated.
Vortexa senior oil analyst Emma Li said Abu Dhabi crude loadings averaged around 4 million barrels per day between June 1 and June 29, compared with about 3.4 million barrels per day before the conflict. Exports climbed to roughly 3.7 million barrels per day from around 3.3 million barrels per day during the first two months of the year.
Regional oil flows improve
The UAE’s export recovery forms part of a broader improvement in Gulf oil shipments following the easing of regional tensions.
Vortexa estimates crude loadings from Gulf producers excluding Iran rose by about 65 per cent month-on-month in June to around 7 million barrels per day, although volumes remain below levels recorded before the conflict.
The International Energy Agency said continued exports from the UAE, combined with record US crude production and softer-than-expected demand growth from China, helped ease concerns over prolonged supply shortages.
Easing oil prices
Oil prices have since retreated close to pre-conflict levels following the ceasefire agreement between the US and Iran and the gradual normalisation of shipping through the Strait of Hormuz.
Goldman Sachs Group Inc. said the global oil market will swing back into a glut as the impact of the conflict fades and traffic through Hormuz recovers.
The UAE’s export performance comes after the country ended its membership of OPEC on May 1, allowing it to market its crude independently while continuing to invest in expanding production capacity and export infrastructure.