Oil Tracker Mideast Exports Resilient, But Increasingly at Risk

Commodities Research 14 September 2026 | 9:54PM EDT

Oil Tracker: Mideast Exports: Resilient, But Increasingly at Risk

n Brent crude prices have risen to nearly $110 as Saudi Arabia closed its 7mb/d Yulia Zhestkova Grigsby | East-West pipeline following Thursday’s attacks and as a meeting between Iran Goldman Sachs & Co. LLC and other Gulf nations on the future of Hormuz shipping has been postponed. Alexandra Paulus | o While the affected oil volumes and the duration of the outages remain Goldman Sachs & Co. LLC highly uncertain, the April attack on the East-West pipeline reduced oil Filippo Cuscito flows by 0.7mb/d for only four days. | Goldman Sachs International § The recent attack may be more severe and could threaten the remaining 2mb/d of recent Yanbu exports, with the latest repair Daan Struyven | assessments ranging from “very soon” to eight weeks. Goldman Sachs & Co. LLC

o Although Saudi Arabia’s oil exports decreased by 2.8mb/d month-over-month in August as Yanbu loadings dropped below 2mb/d, exports have recovered over the last two weeks to June averages, likely reflecting reverse redirections from Red Sea ports to Eastern ports (Exhibit 1). § Saudi Arabia’s Red Sea exports remain 3.3mb/d below the June average as rising reported exports via Suez and the SUMED pipeline were able to offset only 0.3mb/d of the Bab-el-Mandeb decline. § However, exports via Hormuz and other Eastern ports increased by 3.3mb/d since June. o The attacks on oil infrastructure mark a meaningful escalation of the conflict and increase the probability of our price upside scenario, where Brent exceeds $120 (if 2027 average Gulf output remains 4mb/d below pre-war levels). n Recent estimates suggest that Persian Gulf crude output decreased by 1.2mb/d in August from July, implying crude production losses of 7.1mb/d (Exhibit 2). o Production diverged in August across producers: § Saudi Arabia’s production slipped given attacks on both its Eastern and Western shipping routes, while the US blockade weighed on Iranian production. § Iraqi and UAE production continued to ramp up on growing dark crossings and potential assistance from the US. o Given the stunted recovery in Persian Gulf production, the market has likely shifted to a larger deficit in August after being nearly balanced in July

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(Exhibit 3). § Averaging recent external estimates and our visible stocks draws suggests an August deficit of around 3mb/d, wider than our balance estimate of around 1mb/d. n We estimate recent total Persian Gulf oil exports have edged up to around 16-17mb/d (around 70% of pre-war levels), while recent visible exports stand at only 13mb/d (7DMA) (Exhibit 4).1 o We now estimate a net hit to Persian Gulf exports of 6.7mb/d (Exhibit 5). n While OECD commercial stocks remain well insulated from global oil market tightness, investors question the sustainability of the core buffers: OECD SPR releases and low China crude imports. o The pace of visible draws in OECD crude SPR slowed down to 0.3mb/d over the last month, with the US accounting for all the draws, while Japan and South Korea have already started to rebuild their reserves (Exhibit 8). § The initial terms of US SPR swap imply the return of the borrowed barrels from November 1st, with Secretary Wright confirming the start of the SPR refill in the “next few months”. o China crude imports remain down a large 4mb/d year-over-year (Exhibit 9), but may increase somewhat despite firm crude prices because of: § Security incentives to refill domestic China gasoline and diesel inventories that are down 9% yoy. § Economic incentives to increase refined product exports given high margins and 0.4mb/d of room for a pick-up within the annual export quota. n President Trump announced on Monday that Ukraine and Russia agreed not to hit energy targets, sending European diesel prices 5% lower, while Ukraine warned later that no deal has been finalized. o Russia refinery outages remain at 4.6mb/d, keeping refined product exports down 1.1mb/d…