Despite stepped-up Iranian attacks on tankers in the Strait of Hormuz, the flow of oil from the region has not only held steady but actually risen above prewar levels. Tracking data from Kpler shows that shipments via the strait and alternate routes averaged over 24 million barrels daily last week, topping the 23.3 million average before hostilities began.
But the resilience is fragile. The threat of Iranian strikes still deters some tankers, though lucrative payouts attract enough vessels to keep trade moving. Pipelines that bypass the strait are also picking up slack, and major consumers have reduced demand. Prices for some Middle East oil supplies in Asia have fallen below levels seen a month ago, sources told Bloomberg.
Brent crude prices have surged recenlty on reports that the U.S. and Israel are preparing fresh attacks on Iran, but they remain below the war's peak. "Energy security shocks are persistent, not episodic, and supply-chain and shipping disruptions remain material risks," JPMorgan analysts wrote in a note Wednesday. "Energy markets are converging on a forever conflict in the Middle East, but supply has been resilient and demand destruction in China has been key."
While more than half of investors surveyed by JPMorgan expect disruptions to keep energy prices structurally elevated over the next 12 months, the bank estimates demand destruction could cap oil at around $90 per barrel, preventing a surge to $120-$140 that some fear.
Longer-term, infrastucture upgrades are underway. Saudi Arabia plans to convert an existing natural gas pipeline to carry 1.2 million barrels per day of oil within six to eight weeks, and the United Arab Emirates will complete a second pipeline to its port at Fujairah next year, according to Hamad Hussain, a senior commodities economist at Capital Economics.
Yet the risk of escalation remains high. Iran has warned that any new U.S.-Israeli attacks could target not only energy infrastructure but also data centers and internet cables. Tehran has also threatened mutual destruction against oil terminals. "There are lines one simply doesn't cross even during conflict," the monitoring group TankerTrackers posted on X.
President Donald Trump has shown restraint despite earlier threats to hit Iranian infrastructure, opting for economic warfare through a naval blockade and sanctions. U.S. Ambassador to the United Nations Mike Waltz told the Financial Times that the administration could maintain the blockade for the foreseeable future and is tightening economic pressure, but acknowledged a stalemate with Iran could persist a year from now.