Petroleum product exports through the Strait of Hormuz are gradually making a comeback, yet the pace remains inadequate to curb the sharp ascent in fuel prices, adding financial strain to consumers worldwide. According to the CEO of Vitol Group, Russell Hardy, and several traders gathered at a conference in Singapore this week, at least one million barrels of oil products are currently transiting the waterway daily. This figure aligns with data from tanker tracking firm Vortexa, whereas pre-conflict levels stood at roughly four million barrels per day, excluding liquefied petroleum gas.

Compared to crude oil exports, which have rebounded to about half of pre-war levels, the recovery in refined products lags behind, driving up costs for diesel and other fuels and directly feeding into inflation and the cost of living. Ukrainian strikes on Russian refineries have further intensified the fuel scarcity in the market. "Replacing those products originating from the Gulf region is by no means an easy task," remarked Shaikh Khaled Al Sabah, General Manager of International Marketing at Kuwait Petroleum Corporation, during the S&P Global Energy Asia Pacific Petroleum Conference in Singapore.

Traders at the meeting indicated that the sluggish transport recovery stems partly from the difficulty in securing tanker availability. Despite the looming threat of attacks, some vessel owners are still willing to haul crude through the Strait of Hormuz due to soaring freight rates. However, refined products typically move on smaller ships, requiring a greater number of voyages and exposing them to elevated risks.

Gulf nations are renowned for their massive crude output and equally serve as major refining hubs. The International Energy Agency estimates that the Middle East contributed approximately ten percent of global refined product output last year. The nearly seven-month-long conflict has severely damaged numerous refineries, diminishing fuel processing capacity, while the near-closure of the Strait of Hormuz continues to disrupt energy transportation.