Unexpected news about oil shipments through the Strait of Hormuz and the Persian Gulf. The latest assessment from Washington
US Energy Secretary Chris Wright said on Tuesday that naval traffic in the Persian Gulf and oil exports through the Strait of Hormuz are increasing, even as Washington and Tehran struggle to reach an agreement to end the more than three-month-old conflict that has affected the entire Middle East region, reports Reuters.
“I would say (shipping) is increasing very significantly,” Wright said when asked how shipping traffic through the strait is compared to a week or two ago.
He stated that oil exports through the strategic Straits and the Persian Gulf have increased and “will continue to increase”.
Wright made the remarks at an Atlantic Council conference and added that it will take many months to return to normal flows of energy and critical materials such as sulfur, helium and lubricants once a lasting peace is achieved.
Shipping through the strait has been largely blocked since US and Israeli strikes on Iran since late February, cutting off about 20 percent of global oil and liquefied natural gas (LNG) supplies. But since then, some ships have begun transiting the strait that borders Iran, often with transponders turned off and under the cover of darkness.
Disruptions to normal flows have triggered a spike in global energy prices, destabilizing economies around the world and creating a political vulnerability for US President Donald Trump and the Republican Party ahead of November's midterm elections.
Washington has pushed for a peace deal with Tehran that would include the full reopening of the strait.
Global Brent crude oil prices fell more than 3 percent to $91.34 a barrel on Tuesday after Iran and Israel ended their attacks on each other following a call by Trump, although both sides warned they could resume hostilities.
Wright stated that the price of oil did not rise more during the war, in part because global inventories, particularly in China, were “higher than we would have expected”. He said China's oil imports fell by about 4 million barrels per day in May as the country reduced inventories, but added that the change did not represent a price-driven drop in demand.
