Gulf Oil Exports Recover as Washington Weighs a Diesel Export Ban
Middle East crude exports rebounded this month to just under 80% of their level before the war, the highest since fighting began in February. The physical toll on the oil market is easing even as the diplomacy stalls. At home, American retail diesel is hovering near a record $6.53 a gallon, and the administration is again weighing a ban on exporting it.
An export ban is the kind of measure that looks like relief and behaves like a trap. Keeping roughly 1.2m barrels a day at home would risk overwhelming storage on the Gulf Coast, which is why the administration distanced itself from an earlier version of the plan only days ago and is now circling back to it. The recovery in Gulf shipments is real but it is a recovery in workarounds rather than in normality: Saudi Arabia has been diverting cargoes from the Red Sea port of Yanbu to Ras Tanura in the east after attacks damaged its East-West pipeline. And the squeeze on Iran itself is tightening, with the treasury secretary Scott Bessent saying Tehran could have “nothing left to trade for anything” within a fortnight once its remaining deliveries to China are complete. Watch the diesel decision.