On the afternoon of July 25, a supertanker docked at the Mesaieed oil terminal in Qatar, about 40 kilometers south of Doha. Four days later, loaded with crude oil, it passed through the Strait of Hormuz and continued on its way to the Persian Gulf.

On July 31, however, shortly after 2 p.m., while off the coast of Dubai, the ship disappeared from monitoring screens. The very large crude carrier (VLCC) had deactivated its AIS system, the transponder that transmits a ship’s identity, position, course, and speed. For the agencies that monitor international shipping, the VLCC—over 300 meters long—temporarily ceased to exist.

At 10 a.m. on August 1, its signal reappeared. By then, however, the supertanker had already passed to the other side of the Strait of Hormuz.

Its route was not an isolated incident. As CNN reports in an extensive story, it is part of a new tactic by the oil industry: nighttime “stealth” crossings with tracking systems turned off and under U.S. military escort, aimed at reducing the risk of Iranian drone attacks. The same vessel had been targeted about a month earlier, when it was struck by a drone, though the payload did not explode.

The 8 to 9 million barrels the market “doesn’t see”

With the assistance of the U.S. Navy, oil companies from Saudi Arabia, Kuwait, Qatar, and the United Arab Emirates have chartered tankers that are crossing the Strait with their transponders turned off.

The ships transport the oil from the Persian Gulf to the Gulf of Oman, where it is transshipped to other tankers owned or chartered by the end customers. The first ships then return to the Persian Gulf for a new cargo.

In this way, a large portion of the insurance and physical risk associated with transiting the Strait of Hormuz is transferred from international commercial charterers to the oil-producing countries themselves and, as far as the security of transit is concerned, to the United States.

This practice appears to have yielded greater results than the markets indicate.

According to the U.S. Department of Energy, an average of 8 to 9 million barrels of oil per day continue to pass through the Strait of Hormuz. This is roughly double the amount estimated by Wall Street analysts and shipping-monitoring companies such as Kpler, which rely heavily on AIS signals.

The discrepancy is explained precisely by the ships that “disappear” from the charts.

In just two days, more than a dozen ship-to-ship transfers were recorded in the Gulf of Oman, with the cargoes then continuing on to China, Taiwan, South Korea, the Philippines, Vietnam, and Thailand.

80% of transshipments now take place “under the radar”

The new strategy is being implemented at a critical time for the global energy market.

The armed conflict has disrupted about one-fifth of the global oil supply for approximately six months. Meanwhile, commercial oil and fuel stocks have fallen dramatically, U.S. strategic reserves are at levels not seen since the early 1980s, and China is drawing on part of its massive reserves to prevent an even greater rise in international prices.

Faced with the risk of an energy crisis of much greater proportions, Middle Eastern producers have begun systematically implementing “dark” shipments in recent weeks.

This solution is anything but safe. The Strait of Hormuz is only about 37 kilometers wide at its narrowest point, while a tanker can still be detected by radar or satellites even with its AIS turned off. Two ships from the United Arab Emirates were attacked this week.

Despite the risk, according to Kpler, approximately 80% of traffic through the Strait over the past two weeks took place without active transponders, with ships sailing as close as possible to the coast of Oman and away from Iran.

Saudi Arabia is bypassing the Strait of Hormuz

Covert transits are not the only tactic Middle Eastern producers are using to maintain their exports.

Saudi Arabia has rerouted approximately 5 million barrels per day through the East-West Pipeline to the port of Yanbu on the Red Sea. These are volumes that, under normal circumstances, would depart from ports in the Persian Gulf and pass through the Strait of Hormuz. Producers in the region have managed to bypass the Strait for an additional approximately 2 million barrels per day.

At the same time, production has also increased in other parts of the world. Brazil, Guyana, and Venezuela have collectively added more than 1 million barrels per day to the global market, while the U.S. is also producing hundreds of thousands of additional barrels per day.

On the other side of the equation, Washington has released 400 million barrels from its strategic reserves into the market, drastically reducing the Strategic Petroleum Reserve. China is also drawing on its large oil reserves, while significantly curtailing crude imports. And demand itself has fallen due to higher prices.

In other words, the market has proven to be much more resilient than even experienced analysts expected at the start of the crisis.

Satellites spot ships that don’t appear on maps

Satellite images reveal the true extent of the operation. In photographs from August 14, rows of small dots—ships—can be seen moving in an arc along the coast of Oman and through the Strait.

At the same time, there were no corresponding records in the AIS data. The ships had essentially “gone off the radar.”

Why this solution cannot last forever

The system buys time, but it does not solve the problem. During the war, global oil reserves are estimated to have fallen by as much as 1.9 billion barrels.

Even if the market eventually reaches equilibrium, these reserves will have to be replenished at some point. Otherwise, they will fall to such low levels that they will no longer be able to serve as a safety net against a new crisis.

In such a scenario, the primary balancing mechanism would be far more painful: prices would have to rise enough to curb global consumption even further.

The problem has already begun to manifest itself in refined fuels. Three of the four major global refining hubs are under severe pressure. The war has caused damage to refineries in the Middle East and has curtailed exports of petroleum products from the region.

At the same time, Russian refineries have been hit by Ukrainian drones, while Moscow, facing domestic fuel shortages, has curtailed exports. China is also reducing exports of refined products to ensure domestic sufficiency.

As a result, much of the burden now falls on U.S. refineries along the Gulf Coast, which, however, cannot operate indefinitely at maximum capacity.

Oil near $100 and higher prices for gasoline, diesel, and jet fuel

The pressure is already particularly intense on gasoline, but especially on diesel and jet fuel, where available refining capacity is insufficient to comfortably meet demand.

That is why their prices have risen much more than the price of crude oil alone would justify.

For months, Donald Trump had managed to keep market expectations in check by speaking of imminent diplomatic progress. However, the U.S. strategy has now shifted toward exerting sustained economic and naval pressure on Iran.

This shift has driven oil prices gradually higher, now approaching $100 per barrel.

The conflict over control of the Strait of Hormuz thus continues to keep oil prices—and, even more so, gasoline, diesel, and jet fuel at high levels, fueling inflation and reducing consumers’ disposable income.

However, the fact that the global market has managed to establish new routes, increase production in other countries, draw on strategic reserves, and carry out millions of barrels “invisible” transits through the Strait of Hormuz has so far averted the worst-case scenario.

Without this coordinated and largely unseen operation, the greatest disruption to oil supply the global market has ever experienced could have driven prices much higher.

Source: Proto Thema