Gulf oil exports rebound despite risks, but product markets lag, Goldman and JPMorgan find

This week, two of Wall Street's largest oil trading desks reached the same conclusion: the Persian Gulf has found ways to export crude amid ongoing conflict.

According to Goldman Sachs, Gulf exports — including what the bank refers to as "dark exports" — reached 23.3 million barrels per day last week. That matches the 2025 average after volumes doubled in September. JPMorgan's estimate is more cautious, with a 10-day average of 20.5 mb/d, or 89% of 2025 levels. The bank titled its note "The final 11%." The difference largely reflects how much of the shadow fleet each firm counts, but both see the same trend.

The recovery has occurred despite numerous setbacks. The Saudi East-West pipeline was hit, cutting flows to Yanbu for nearly two weeks. The Houthis continue to block Saudi crude at Bab-al-Mandab. Still, Hormuz crossings — including ship-to-ship transfers — have taken up the slack. JPMorgan says flows through the Strait of Hormuz are back near the late-June highs of almost 13 mb/d, led by Saudi Arabia.

The issue is that refined products are not moving, keeping diesel prices very high.

• Goldman places crude exports at 19 mb/d, or 108% of the 2025 average. JPMorgan puts them at 17.5 mb/d, 98% of pre-war levels.
• Exports of diesel, gasoline and jet fuel are running at only about 50% of normal according to Goldman, and 58% according to JPMorgan.

Goldman cites two reasons for this. First, Middle East refinery outages remain 2.0 mb/d above seasonal norms, while crude production capacity has largely been unaffected. Second, product tankers are smaller and carry more flammable cargo, making the per-barrel risk cost of transiting Hormuz higher than for crude.

JPMorgan sees shipping capacity as not the limiting factor. VLCC charter rates linked to Hormuz are near $1.27 million a day, with owners simply charging for the risk. A five- to ten-year-old VLCC is now valued above $150 million, compared with about $135 million for a newbuild.

Goldman maintains its base-case forecast for Brent to fall to $85 by year-end and $80 in 2027. The bank says the global market was roughly balanced in September, and OECD commercial stocks have returned to late-February levels. Yet dated Brent is near $120. Goldman attributes that gap to a risk premium built on three factors:

1. Escalation that could affect long-term production capacity.
2. Record-low global stocks outside OECD commercial inventories.
3. A rush to quickly rebuild those stocks.

Goldman describes September's global oil market as roughly balanced, with visible inventories broadly unchanged. It notes that buyers also have an incentive to rebuild inventories before another disruption.

Brent: