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Iran's crude oil exports have effectively vanished from the global market due to a US naval blockade, enhanced sanctions and numerous attacks on Iranian oil shipping. TankerTrackers.com reported no Iranian crude barrels crossed the US Navy's blockade line in the Gulf of Oman and Arabian Sea during the past 60 days. The US has reimposed a blockade on Iran-related shipping since mid-July, according to Reuters, leading to a significant halt in Iranian crude exports.

The blockade and Iran's retaliatory actions have reshaped Gulf trade. Despite Tehran's vow to expand the restricted zone, Iran's oil exports have plummeted, with only 1,300 commercial vessels transiting the Strait of Hormuz since May 2026, as reported by US Central Command. The export collapse has not caused a sudden storage glut like usually seen when a major producer loses overseas market access.

Iran's crude production has fallen to roughly the level required for domestic consumption and refining, leaving minimal surplus oil to accumulate in storage. This hints that the export collapse is being accompanied by a substantial reduction in production rather than an accumulation of barrels at Iranian terminals.

US economic pressure specifically targets Iran's oil lifeline. Apart from the shipping blockade, the US Treasury has been targeting Iran's shadow fleet, oil traders, shipping companies, financial intermediaries, and foreign buyers. In April, the Treasury sanctioned China's Hengli Petrochemical refinery and around 40 shipping companies and vessels, alleging they provided financial support to Iran's oil industry.

In July, the Treasury expanded the campaign against Mohammad Hossein Shamkhani's shipping empire, identifying over 50 individuals, companies and vessels involved in Iran's oil trade and sanctions evasion. The campaign intensified in August with Operation Economic Outcast, which included sanctions on shipping and other sectors aimed at cutting the financial channels used by Iran to smuggle oil and evade sanctions.

The blockade is altering Iran's oil export economics, making it difficult for tankers to move additional barrels into international waters due to interception, attack, sanctions exposure, and loss of insurance or financial services.