Wright says Hormuz oil flows recover as fuel exports lag

U.S. Energy Secretary Chris Wright said Monday that oil flows through the Strait of Hormuz are back to 80% to 90% of where they were before the conflict, or about 13 million to 14 million barrels per day. He warned that the region's exports of refined fuels are recovering much more slowly.english.aawsat

Wright spoke by video link to the WPC Energy Congress in Riyadh, Saudi Arabia, according to Asharq Al-Awsat. The congress runs from Oct. 11 to 15. He said crude supply was "largely under control, but not fully resolved." He credited spare production capacity, large inventories and more oil moving through alternative pipelines.wpcenergy2026+1

Fuel shortages remain the main problem

Wright said the bigger problem is refined products leaving the Arabian Gulf. Those flows are at only 25% to 35% of pre-conflict levels, which is making shortages of diesel, jet fuel and gasoline worse. He said global diesel prices had reached very high levels and jet fuel had also risen, while gasoline had gone up more moderately.english.aawsat

Other supply sources have shrunk at the same time. According to Wright, Russia used to be a major diesel supplier but has become a net importer, though in small volumes. He said China had sharply cut its fuel exports and announced it would export no refined products in October. Wright said he hoped Chinese refineries, which have spare capacity and are earning strong profit margins, would raise output. He added that U.S. refineries were running at record levels.english.aawsat

Shipping problems slow the recovery

Wright said shipping is another obstacle. Houthi disruptions in the Bab al-Mandab Strait have forced tankers onto longer routes, and Iranian attacks on vessels have reduced the shipping capacity available. Higher freight costs hit markets far from supply sources the hardest.english.aawsat

He said less Iranian, Venezuelan and Russian oil is moving on the so-called "dark fleet," which has left many tankers idle. Wright argued that some of those ships should be brought back into mainstream shipping, with sanctions lifted where possible, to carry more fuel out of the Gulf.english.aawsat

He named the course of the Russia-Ukraine war and China's fuel export policy as the main factors for supply in the coming period. Wright said the response to the conflict had shown the energy system can adapt, but that the crisis is not over and continued efforts are needed to keep supplies stable.ua+1