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U.S. blockade keeps Iranian oil exports from affecting global supply

With the U.S. reinstating the Gulf of Oman blockade, Iranian crude volumes are effectively sidelined after a July collapse of talks described as a “deal to make a deal.”

Reported · Written up by our desk · Energy

OilPrice reports that the reinstated U.S. blockade on Iranian oil exports is preventing Tehran from exporting crude, leaving Iran’s oil volumes effectively irrelevant to global supply and balance calculations.

According to Rapidan Energy Group president Bob McNally, cited by CNBC, the U.S. moved to restart the blockade in the Gulf of Oman after what was characterized as a “deal to make a deal” collapsed in July.

OilPrice adds that the blockade was aimed at stopping Iranian exports, so the impact on global markets comes less from Iranian production volumes and more from where displaced supply would otherwise flow.

The development also underscores that changes to enforcement, rather than just production levels, can quickly alter the practical contribution of a major exporter to the global oil market.

Latest closeWTI crude $82.40 ▲1.4%

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