Oil Supply Is Recovering. The Logistics System Is Not.

Executive Market Summary

The oil market is entering a new phase of the Middle East crisis.

Physical crude availability is improving materially, but logistics, refining capacity and middle-distillate availability remain the critical constraints.

Middle East crude exports briefly exceeded pre-war levels during September, reaching a seven-day average of 18.3 million bpd, while flows through Hormuz have recovered to roughly 80% of pre-war levels. Yet tanker attacks, extraordinary freight costs, elevated insurance and operational complexity continue to prevent normalization.