A 4-Million-Bpd Shadow Oil Highway Is Running Through Hormuz

U.S. Treasury Secretary Scott Bessent has forecasted that the Strait of Hormuz will lose relevance within two years, and Gulf oil producers seem to be moving their oil around it. In the midst of the Iran conflict, the UAE, Iraq, Kuwait, and Qatar are exporting more than 4 million barrels per day through a shadow export network involving dark shuttle tankers and ship-to-ship transfers outside the Persian Gulf.

This workaround has become one of the largest adjustments to the war. Around 150 vessels are currently stationed off Oman, up from approximately 40 in January, with tankers making repeated trips through Hormuz with their transponders and lights turned off before transferring their cargo to larger ships waiting outside the strait.

This shadow network started forming in early May when the U.S. military began overseeing ship-to-ship transfers off Fujairah in the UAE and Sohar in Oman. Tankers carrying crude oil from the Gulf pass through Hormuz with their transponders and lights switched off, then dock alongside larger vessels stationed outside the strait to transfer their cargo, before returning to the Persian Gulf for more loads.

Satellite images show as many as 17 simultaneous transfers at these two locations. Although nearly 20 million barrels per day were once moving through the strait, the operation of pipelines, emergency stockpiles, and the growing tanker shuttle has ensured enough Gulf supply remains in action to prevent a severe shortage.