Middle East crude exports exceed pre-war levels, pulling oil prices lower despite fresh Hormuz attacks

Oil prices moved lower Monday as Middle East crude exports surpassed pre-war levels, countering the impact of renewed attacks on vessels near the Strait of Hormuz and escalating conflict in Yemen. West Texas Intermediate crude opened nearly $1 a barrel higher before reversing course to trade around $90 a barrel, down roughly $1. Brent crude was also lower near $102 a barrel, according to market data.

The price reversal highlights a market that is increasingly separating geopolitical risk from actual supply losses. Even as Iran-backed Houthi forces claimed new strikes on Saudi energy infrastructure and a U.S.-led blockade in the Strait of Hormuz continued, crude availability from the region has improved.

Shipping data from Kpler and Vortexa, as reported by accounts citing Reuters, showed that Middle East oil exports exceeded pre-war levels in September. The seven-day moving average stood at 18.3 million barrels per day on September 30, compared with an average of 18 million bpd in the 12 months before the war. Saudi loadings led the increase, according to that data.

Saudi Aramco reinforced the bearish supply signal by cutting November pricing for its benchmark Arab Light crude to Asian customers to a $5 a barrel discount to the regional benchmark — down $3 from October and the widest discount since June 2020. The price reduction comes as Gulf producers compete for Asian market share while regional export volumes recover.

OPEC+ added further stability to the supply outlook over the weekend, agreeing to keep November production quotas unchanged after previously signaling that additional increases would pause through year-end, according to Mansfield Energy.

**G7 emergency release adds barrels**

The G7 countries agreed Friday to release 100 million barrels of crude and refined products from emergency reserves over the coming months, following a larger 400-million-barrel release announced earlier this year. The latest release is intended in part to ease elevated diesel prices. In a related move, President Trump said the U.S. would not impose a ban on diesel exports, removing a layer of uncertainty that had threatened to tighten domestic gasoline supply.

Despite the additional barrels, refined products — particularly diesel — remain tighter than crude. The release may ease near-term availability concerns, but refining constraints could keep diesel prices elevated even as crude prices decline, analysts noted.

**Attacks continue, but flows hold**

Risks to shipping remain elevated. Iran has launched another wave of attacks against vessels operating around the Strait of Hormuz, with at least seven incidents reported since late September, according to Mansfield. The U.S. military said Monday it had destroyed 13 commercial ships in the strait over the past 12 weeks, with U.S. Central Command stating that the vessels were either violating the Navy’s blockade or were part of the Islamic Revolutionary Guard Corps’ shadow network. Since July 14, U.S. forces have disabled three ships that refused to comply and redirected 130 commercial vessels attempting to pass through the strait.

In Yemen, Houthi forces said they struck King Khalid International Airport in Riyadh, a Saudi Aramco refinery in Rabigh and other sites across the kingdom’s south, according to a statement from Houthi military spokesman Yahya Saree. The attacks included drones, ballistic and cruise missiles. Saudi Arabia has not confirmed damage from those claims.

A Saudi-led coalition in Yemen said Monday it had struck military targets belonging to the Houthis in Hodeida on the Red Sea coast. Coalition spokesman Turki Al-Malki said naval forces destroyed weapons depots, facilities storing booby-trapped boats and naval mines, and thwarted a planned attack targeting waterways in the southern Red Sea. The coalition said 100 warplanes flew sorties at dawn, while the Yemeni military said it carried out more than 1,000 strikes and began an offensive against the Houthi-held capital, Sanaa.

Turkey and Pakistan agreed to a rapid deployment of troops to Saudi Arabia as part of a new mutual defense alliance, the three countries said Monday, as the kingdom faces escalating Houthi attacks.

**Supply alternatives mitigate risk**

Saudi Arabia has increased shipments through its East-West pipeline after operating at roughly half of its 7 million bpd capacity earlier last week, providing an alternative crude route that avoids the Strait of Hormuz and contributes to improved regional exports, according to Mansfield Energy.

The broader economic picture added a further bearish element for oil demand. U.S. nonfarm payrolls increased by just 29,000 in September, while July and August employment growth was revised lower by a combined 60,000 jobs, Mansfield reported. The unemployment rate edged up to 4.2%.

In a social media post, President Trump attributed high gasoline prices not to the Iran war but to Ukrainian strikes on Russian oil refineries, writing that “Record Numbers of Barrels are coming out now on an almost daily basis” from the Middle East. Iranian President Masoud Pezeshkian called negotiations with the U.S. “meaningless,” state media reported, saying that renewed attacks after talks showed Washington was not seeking dialogue.

For now, crude markets are increasingly discounting the latest attacks as long as physical supply continues to flow. Unless disruptions materially reduce export volumes, improved availability from the Middle East, together with emergency inventory releases and stable OPEC+ quotas, could continue to weigh on WTI and Brent prices.