Why Oil Prices Remain Below $100 Despite Supply Disruptions
Global oil benchmark Brent crude has risen this month but remains below the $100 per barrel mark, despite recent U.S.-Iran tensions disrupting Gulf exports. Although shipments from Middle East producers have dropped to about 11 million barrels per day (bpd) from 18 million bpd before the conflict began seven months ago, some volumes continue flowing through Hormuz and alternative routes are being used. Gulf exporters like Saudi Arabia, Iraq, UAE, and Kuwait are mitigating supply shortfalls by using alternate ports such as Egypt's Sidi Kerir. Non-OPEC producers including the U.S., Canada, and Guyana plan to increase output this year. Meanwhile, demand destruction remains significant at 3.5 million bpd in Q3 due largely to China’s shift toward electrification and coal-based chemicals. Despite these disruptions, market stability is supported by alternative shipping routes and increased production from other regions.
