Iran’s oil exports slump to multi-year lows under mounting US pressure

Iran’s crude oil exports plunged in May, falling to their lowest level in at least six years amid intensified US pressure and disruptions to regional shipping, according to industry data and analysts.

Shipping publication Lloyd’s List reported that exports dropped by 84% month-on-month and were 87% below the average level for the previous 12 months through the end of April.

The decline comes as Washington has increased pressure on Iran’s oil export network, while ongoing instability in regional shipping lanes has further constrained flows. Tehran has increasingly turned to smaller tankers to move crude, as very large crude carriers face a higher risk of interception by US forces, the publication said.

The sharp fall in exports has forced Iran to cut production by about 800,000 barrels per day, or roughly 10% compared with the previous month.

Shipping data and analysts indicate that exports of Iranian oil and condensate fell to well below 300,000 barrels per day in May, largely due to a US naval blockade that began on April 13. The blockade has significantly reduced Iran’s export capacity and contributed to broader supply disruptions in global oil markets, exacerbated by the effective closure of the Strait of Hormuz, which has also curtailed exports from Saudi Arabia, Kuwait, Iraq and the United Arab Emirates.

Data from analytics firm Vortexa showed Iranian exports averaging about 209,000 barrels per day in May, down sharply from 1.34 million barrels per day in April and nearly 1.9 million barrels per day in March. The firm said this marks the lowest level since late 2019 and early 2020, during the “maximum pressure” campaign pursued by US President Donald Trump in his first term.

“The key drivers appear to be disruption in the Strait of Hormuz, the US naval blockade targeting vessels entering or leaving Iranian ports, and a general reluctance among owners, operators, insurers, and counterparties to expose vessels and crews to the current security environment,” said Vortexa analyst Claire Jungman.

Separate data from Kpler pointed to a similar contraction, although it estimated May exports slightly higher at around 260,000 barrels per day, still the lowest in six years.

Kpler also reported that floating storage volumes are declining as more Iranian crude is discharged in China. Of approximately 147 million barrels of oil and condensate held at sea, around 67 million barrels remain stranded in the Persian Gulf and the Gulf of Oman. Floating storage has fallen from a recent peak of about 190 million barrels at the end of April.

Iman Nasseri of FGE NexantECA estimated that roughly 55 million barrels of Iranian crude are held on tankers beyond the blockade line, a lower figure than Kpler’s assessment.

By Tamilla Hasanova