Middle East crude oil exports recover to 98% of pre-war levels! JPMorgan research report reveals "oil shortage trade" is cooling, but energy inflation is hard to exit

Title context: Middle East crude oil exports recover to 98% of pre-war levels! JPMorgan research report reveals "oil shortage trade" is cooling, but energy inflation is hard to exit Text: Wall Street financial giant JPMorgan's latest crude oil flow analysis and research report shows that despite persistent shipping risks in the Strait of Hormuz and the Bab el-Mandeb Strait, Middle East crude oil transportation volumes have almost recovered to pre-war levels. Recently, U.S. officials have repeatedly said that crude oil flows through Hormuz have increased, although investors' consensus estimates are more conservative. Earlier this month, U.S. Treasury Secretary Scott Bessent said about 17 million barrels of oil per day are transiting, while TotalEnergies SE CEO Patrick Pouyanne sees 10 million barrels per day of crude and products flowing out. Although Middle East oil exports are showing unexpected resilience, the energy supply chain, including refined products, has not yet returned to normal. JPMorgan's September 29 estimates show that Middle East crude oil export transportation volumes have rebounded to 17.5 million barrels per day, equivalent to 98% of pre-war levels; diesel, gasoline and other refined product transportation volumes have recovered to only 58% of pre-war levels, while combined crude and refined product transportation volumes have reached 89% of 2025 levels. Export arteries flowing again! JPMorgan: Middle East crude oil transportation volumes reach 98% of pre-war levels A JPMorgan analyst team including Natasha Kaneva said in a September 29 report: "The main arteries of Middle East oil exports are reopening." They said this is "a remarkable recovery" for a region still at war, although the recovery does not appear balanced. JPMorgan said crude oil transportation volumes have rebounded to 17.5 million barrels per day, equivalent to 98% of pre-war levels; diesel and gasoline and other refined product transportation volumes are 3 million barrels per day, equivalent to 58% of pre-war levels. Analysts said in the research report that measured by the 10-day average of the past five days, overall transportation volumes reached about 89% of 2025 levels. As the U.S.-Iran conflict enters its eighth month, the global oil market is closely watching the volume of crude and refined products being shipped out of the region. In addition to cargoes transported through the Strait of Hormuz, Saudi Arabia has also successfully restored about half the throughput of the East-West Pipeline. This pipeline, which crosses Saudi Arabia and delivers oil to its Red Sea port, was damaged earlier this month. Analysts said oil transportation volumes through the Strait of Hormuz have almost "recovered to the late-June high of nearly 13 million barrels per day, mainly driven by Saudi Arabia." "But increased transit volumes should not be mistaken for improved security conditionsthis actually reflects the industry's growing ability to operate in a persistent risk environment." The Strait of Hormuz connects the Persian Gulf with global markets. As Iran claims control over this waterway, attacks on ships have continued for months in the waters around the strait. The United States refuses to recognize this claim and, while blockading Iranian ports, assists ships from other countries in passing through the strait. JPMorgan estimates show that Middle East crude oil export transportation volumes have rebounded to 17.5 million barrels per day, equivalent to 98% of pre-war levels; diesel, gasoline and other refined product transportation volumes have recovered to only 58% of pre-war levels, while combined crude and refined product transportation volumes have reached 89% of 2025 levels. This latest set of data undoubtedly reveals the changes taking place in the oil market: increased transit through the Strait of Hormuz and the restart of Saudi Arabia's alternative transportation corridor are easing crude shortage pressure, but there are still obvious gaps in refined product supply, transportation costs and delivery security. "Being able to ship oil out" and "being able to deliver continuously, safely and at low cost" remain two different supply states. Oil prices are also pricing in this divergence. At 9:30 Beijing time on September 30, front-month Brent crude futures rose 1.11% to $103.73 per barrel after falling on Tuesday; compared with front-month futures prices at each point in time, this is about 43.1% higher than the $72.48 on February 27, the last trading day before the war. However, there is a clear spread between the soon-to-expire November contract and the more active December contract, with the latter settling at $96.16 on September 29. Higher near-term prices reflect that immediate delivery remains tight. Diplomatic progress is not yet enough to eliminate this risk premium. Qatar said on September 29 that it is still using shuttle mediation to push the United States and Iran to find common ground, with restoring freedom of navigation in the Strait of Hormuz a focus; Trump denied having proposed easing sanctions or unfreezing Iranian funds in exchange for concessions on the nuclear issue. Negotiations are still advancing, but no arrangement sufficient to guarantee long-term normalization of commercial shipping has yet been formed, leaving supply recovery and escalation risks continuing to affect oil prices simultaneously. One pipeline, two straitsthe oil market is still paying a "delivery certainty premium" The repair of Saudi Arabia's East-West Pipeline has reopened an important channel for crude oil exports, but a distinction must be made between pipeline capacity, actual throughput and port loading volumes. Data cited by Reuters on September 29 shows that the pipeline has a capacity of 7 million barrels per day, with actual throughput before the attack at about 5.5 million barrels per day; after restart, industry insiders and Kpler estimate current throughput at about 2 million and 2.65 million barrels per day, respectively. Kpler expects this to increase to 3 million-4 million barrels per day in the coming days, and it may still take about a month to restore pre-attack levels. Yanbu port has also resumed loading. Therefore, the pipeline restart means transportation capacity is being released, but it does not mean all 7 million barrels per day has been restored, let alone equivalent to new oil production capacity. From a transportation geography perspective, the East-West Pipeline transports crude oil to Yanbu on the Red Sea coast, helping Saudi Arabia bypass the Strait of Hormuz; after loading, cargoes can head north through the Suez Canal or the SUMED pipeline into the Mediterranean, while the usual route south to Asia passes through the Bab el-Mandeb Strait. Bypassing Hormuz does not mean bypassing all energy transportation and long-haul shipping risks. The U.S. Maritime Administration's current advisory notes that Houthi threats to commercial ships in the Red Sea and Bab el-Mandeb Strait still exist, with Saudi-linked vessels facing higher risk. This risk has already created real costs. Media previously reported on September 24, citing industry sources, that war-risk quotes for Saudi-linked tankers berthing at Yanbu have risen to about 3% of vessel value, compared with less than 1% in early July; this quote system is an insurance quotation, not a uniform rate ultimately agreed for all vessels. Nevertheless, an investment observation framework can be drawn from this: the crude oil/petroleum futures trading market is shifting from simply trading "how many barrels are missing" to also trading "whether those barrels can be reliably delivered." Crude reflow helps the shortage premium, but lagging shipping recovery in refined products and other petroleum product lines, along with high insurance and transportation costs, may still delay the decline in end-user energy inflation.