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Informist, Wednesday, Oct. 7, 2026

 

MUMBAI – The supply of crude oil has shown a rising trend in the last few days, but prices have not fallen significantly. However, if the trend continues, crude oil prices may undergo a sharp correction, according to a report by Commerzbank Research.

 

Crude oil exports from the Gulf region (excluding Iran) have increased to an average of 18.3 million barrels per day in the last week of September, it said, citing data from Kpler. Data from Vortexa also indicate a similar figure of almost 19 million barrels per day (including products) reaching global markets over the past 14 days. "This suggests that shipments have even surpassed pre-war levels, which typically stood at around 18 million barrels per day at this time of year," the report said Tuesday.

 

According to analysts, the rise in the supply of crude oil is primarily driven by an increase in exports from Saudi Arabia, the report said, quoting analysts. Volumes of crude oil transported via the East-West Pipeline have recovered to more than 80% of capacity, equivalent to nearly 6 million barrels per day, it said, adding that at the beginning of last week, utilisation was reportedly only around half that level.

 

Meanwhile, in a related development, Saudi Arabia has announced lowering of its prices for deliveries of Arab Light oil in November. According to the decision, buyers in Asia will get a discount of $5 per barrel over the Oman/Dubai benchmark. The discount has been raised from $3 in October.

 

"The last time the discount was larger than it will be next month was more than six years ago, during the COVID-19 pandemic. At that time, a glut of supply had arisen due to a collapse in demand, which is why Saudi Arabia had to significantly reduce its selling prices. This time, the sharp rise in supply is likely to be the main factor," Commerzbank said.   

 

Other Gulf producers have also increased their crude oil production. According to Kuwait's state-owned oil company, production has recovered to around 75% of pre-war levels. Iraq's oil minister likewise stated that the situation had eased and that efforts were underway to further increase production and exports, the report said.

 

"Overall, the evidence is mounting that Gulf countries are once again managing to transit the Strait of Hormuz despite Iran's official blockade. If this trend proves sustainable, it may be only a matter of time before oil prices respond and undergo a significant downward correction."  End

 

Reported by Abhijit Doshi

Edited by Avishek Dutta

 

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