Gulf oil producers have lost an estimated $15.1 billion in energy revenue since the start of the war between Israel, the United States and Iran. Millions of barrels of crude oil have been trapped as the Strait of Hormuz has been almost completely blocked by Iranian attacks.
This is reported by the Financial Times, citing Kpler estimates.
The strait typically carries about $1.2 billion worth of crude oil, refined products and liquefied natural gas daily. Crude oil accounts for the largest share of the suspended shipments, at 71% of the total value.
Saudi Arabia, as the largest oil exporter, has suffered the biggest losses: $4.5 billion since February 28. The kingdom plans to significantly increase exports through the Red Sea in the coming days — state giant Saudi Aramco says it can redirect about 70% of its production there.
Meanwhile, citing three sources among officials, the Financial Times writes that European states have begun talks with Iran to unblock the Strait of Hormuz. Two of the sources said that France is among those countries. According to one of them, Italy has also tried to join the talks.
Italy, France and Greece have warships in the Red Sea as part of the EU naval force protection mission Aspides. But no European fleet is prepared to escort ships through the Strait of Hormuz if there is a risk of attack.
One of the sources declined to name the countries negotiating with Tehran, noting that other European capitals do not approve of such efforts: “Some believe that we need to talk to the Iranians. But [EU states] have very different views on this, which makes the situation complicated.”
Since the start of the new war in the Middle East, energy prices have skyrocketed. Brent crude is now trading around $100 a barrel for the first time in four years.
To keep prices down, the International Energy Agency has decided to release 400 million barrels of oil, and the US plans to release 172 million barrels of oil from its strategic reserve. On March 12, the US lifted sanctions on the purchase of Russian oil, which was stuck at sea, for 30 days.
War in the Middle East
On the morning of February 28, the United States and Israel launched attacks on Iran. These attacks killed Iranʼs Supreme Leader Ayatollah Ali Khamenei and almost the entire military leadership of the country — about 40 key high-ranking officials. A new ayatollah was elected on March 8, Mojtaba Khamenei (the son of the deceased Ali Khamenei).
Iran responded by launching ballistic missile attacks on Israel and US bases in the Gulf states of Bahrain, Kuwait, Qatar and the UAE. Some Iranian drones and missiles have targeted infrastructure and residential areas in Arab countries.
The Wall Street Journal reported that President Donald Trump has told his aides that he would support eliminating Iranʼs new supreme leader if he refuses to comply with US demands.
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