Gulf oil flows top prewar levels, but shipping costs surge sevenfold

Middle East oil flows have surpassed prewar levels, averaging over 24 million barrels a day in the week ending 18 October, up from the prewar average of 23.3 million, according to ship-tracking firm Kpler. Shipments through the Strait of Hormuz itself remain at about 82% of prewar volumes, with an improvised US-protected shuttle system and pipelines across Saudi Arabia and the UAE helping to bypass the waterway. Around 30 attacks on vessels were reported in October, about 20% of all ship attacks recorded during the war, Windward data shows.

However, shipping costs have surged about sevenfold over the past year to over $20 a barrel, Goldman Sachs analysts wrote. The increase includes $7 for the war-risk premium through Hormuz and $4 each for higher fuel and ship-to-ship transfers. High freight rates may reduce refiner demand for crude and change established trading patterns, the bank warned, though it maintains its forecast for Brent to fall to $90 a barrel by year-end. Brent crude traded at around $108 a barrel on 20 October. Traders remain concerned that the improvement in Hormuz may not be sustainable, with thinning global inventories leaving little margin for error.

Update, 21 October 2026: Hindustan Times now also reports the story, confirming Kpler’s data on oil flows exceeding 24 million barrels a day, with Hormuz flows at 82% of prewar levels. It adds that Brent crude traded near $108 a barrel on Tuesday, 20 October, and that traders worry the improvement may not be sustainable, with global inventories thin. It also notes US air cover provides a protected corridor, while about 30 ship attacks were reported in October, accounting for 20% of all war attacks.