Gulf Oil Detours Keep Exports Moving as Civilians Die

An attack at a civilian airport in Dammam killed at least one person and wounded eight. A drone strike on a Saudi oil field killed two. On Thursday, oil prices rose as the United States ordered some diplomats and family members to leave its missions in Saudi Arabia, while attacks by Yemen's Iran-aligned Houthis intensified. Civilians pay the immediate price, while states and energy companies already route around the disruption.

Brent crude futures rose $1.29, or 1.2%, to $110.11 a barrel at 00:34 GMT. U.S. West Texas Intermediate crude gained 97 cents, or 1%, to $98.12. Brent had ended Wednesday largely unchanged; WTI slipped 67 cents.

The U.S. State Department also planned to withdraw family members from a number of other U.S. missions in the region, U.S. officials told Reuters. Three U.S. officials said the department was preparing to order some personnel and family members to leave U.S. embassies across the Gulf because hostilities could resume, particularly with the Houthis. Two officials said the departures could include all personnel and their families from the U.S. Mission to Saudi Arabia.

Security Alerts, Civilian Targets

The U.S. Embassy in Riyadh issued a security alert warning of possible further Houthi attacks on Saudi Arabia after recent deadly strikes, including at Riyadh's airport. The alert and planned departures reveal how the machinery works: governments move personnel out of danger, while civilians remain exposed to attacks and wider escalation.

Iran's state media reported several explosions on Wednesday in the Karpan area of Sirik, in southern Hormozgan province overlooking the Strait of Hormuz. The official IRNA news agency said, “A few minutes ago, the sound of several explosions was heard in the Karpan area of Sirik, in Hormozgan Province,” adding that “local sources have not yet disclosed the nature of these explosions.” Iranian media also reported explosions in Sirik but said their nature and origin were unknown. The reports haven't confirmed the cause.

Oil Moves; Risk Moves With It

Despite shipping disruptions, Middle East crude exports excluding Iran averaged 24.6 million barrels per day in the week to Oct. 18, according to data compiled by energy intelligence firm Kpler. The comparable pre-war average stood at 23.3 million barrels per day. At least 16.5 million barrels per day of crude left the region excluding Iran between September 1 and 28.

“The volume recovered. The route did not,” Kpler said. Its September analysis found that 40% of regional crude exports bypassed Hormuz, compared with 17% before the war. About 9.9 million barrels per day, or 60%, crossed the strait in September; 23% was loaded outside it, primarily at Fujairah in the UAE; and 17% moved through Saudi Arabia's Red Sea export network. Most exports still used Hormuz.

Saudi Arabia increased shipments through its 1,201-kilometer East-West Pipeline, known as “Petroline,” from Abqaiq-Gawa fields in the Eastern Province to Yanbu on the Red Sea. The UAE expanded use of its 406-kilometer Habshan–Fujairah oil pipeline, which bypasses Hormuz. Producers without similar options remained dependent on the strait, and Saudi shipments shifted between Gulf and Red Sea terminals as disruptions affected loading operations.

A tanker shuttle system has also grown. Tankers load inside the Gulf, cross Hormuz with their automatic identification system switched off, then transfer cargo to other vessels near Fujairah or Sohar. More than 70% of crude that crossed Hormuz in August changed tankers offshore near those locations, Kpler said. Analysts track cargoes using satellite imagery, vessel movements, loading information and destination checks; estimates may change as they confirm additional movements.

The recovery hasn't made shipping safer or cheaper. Gulf News said the International Energy Agency emphasized that higher export volumes came with increased freight rates, war-risk insurance premiums and other costs, amid Iranian attacks on shipping and the threat of further escalation. The Financial Times reported tanker charter rates and war-risk insurance premiums had surged. Reuters reported at least 18 attacks on shipping over the past two weeks, citing Kpler data. LSEG analysts warned that Iran was targeting tankers beyond the Strait of Hormuz, reaching into the Gulf of Oman and jeopardizing crude loadings and ship-to-ship transfers.

The U.S. blockade continued to constrain Iran's exports. On Wednesday, Foreign Minister Abbas Araqchi told the Financial Times that Iran was fully prepared to defend itself. President Masoud Pezeshkian told state media the United States couldn't expect dialogue while blockading and threatening Iran. Each government speaks in the language of security and defense; shipping data records the costs in rerouted cargo, threatened vessels and rising insurance bills.