Hormuz crude is back at 13.5 million barrels a day, but fuel shipments are still down 81%

Crude oil moving through the Strait of Hormuz has climbed back to its prewar pace, according to tanker-tracking data from Kpler reported by CNBC on Wednesday. The seven-day average reached 13.5 million barrels a day as of Monday, matching Kpler's baseline from before the Iran war. Middle East crude exports as a whole, counting the Red Sea, hit 19.5 million barrels a day, above a prewar level of about 17 million.

That is a real change from a week ago. When Saudi exports jumped last week, total Hormuz flows were still about 3.8 million barrels a day short of normal.

The thing the headline gets wrong: crude is not fuel

"Hormuz back to normal" is true for crude and badly wrong for everything a business actually puts in a tank. Refined products shipped through the strait averaged 677,000 barrels a day as of Monday, against 3.6 million before the war, per Kpler. That is about 19% of the old volume, a shortfall of roughly 2.9 million barrels a day. Counting crude and products together, flows are at about 80% of the prewar baseline.

JPMorgan's head of global commodities strategy, Natasha Kaneva, summed it up for CNBC: the "crude market has largely normalized even as refined product supplies remain constrained."

The market is behaving that way too. Brent was about $102 on Wednesday afternoon, up roughly 2.5%, and WTI about $93.27, up about 1.8%, according to the live quotes on our markets board. Crude flows recovering has not pulled prices down, because the tight spot is refining and product shipping, not wells.

Who it actually hits: the diesel bill

The Energy Information Administration's weekly pump survey put the U.S. average for on-highway diesel at $6.382 a gallon on September 28, down 14.7 cents on the week but $2.628 higher than a year ago. Regular gasoline was $4.465, up $1.347 from a year ago. On the West Coast diesel averaged $7.357, and in California $8.181.

The year-on-year gap is the number that matters for anyone who buys fuel in bulk. As an illustration, a regional hauler or excavation contractor burning 20,000 gallons of diesel a year is paying about $52,560 more for the same work than a year ago at the national average (20,000 x $2.628). A landscaping crew running 5,000 gallons of gasoline across its trucks and mowers is paying about $6,735 more (5,000 x $1.347). Neither number comes down just because crude tankers are moving again.

Our separate report today on the Dallas Fed Energy Survey found 48% of Texas-area oil executives expect diesel to take more than four quarters to return to 2025 price levels.

Why the crude recovery is fragile

• It runs on escorts and transfers. More than 70% of the crude that crossed Hormuz in August was moved onto another tanker off the United Arab Emirates or Oman, per Kpler, using shuttle tankers protected by the U.S. military. RBC's Helima Croft told CNBC the arrangement is "very expensive and it's a huge U.S. military commitment."
• Pipelines carry more than double their old share. About 40% of Gulf crude now bypasses Hormuz through Saudi and UAE pipelines, against 17% before the war, according to Kpler. Saudi Arabia's East-West line was shut earlier this month after a drone strike, and loadings at the Red Sea port of Yanbu have since picked up.
• Diplomacy has stalled. CNBC reported that Iran offered last week to reopen Hormuz in seven days under terms the U.S. rejected, and cited a Wall Street Journal report that President Trump has told aides he expects to resume bombing after the midterm elections.

What traders are watching

For oil traders, the spread between crude and products is the story now. Crude supply is closer to normal, so the pressure sits in refining margins and diesel futures. CNBC noted the administration is weighing a fuel export ban. We covered that proposal and U.S. diesel export volumes here. OPEC+ meets Sunday. Live prices are on our crude oil chart.

Sources: CNBC, citing Kpler data; EIA Gasoline and Diesel Fuel Update. Fuel cost examples are illustrations using EIA national averages. Prices are intraday and will change. This is market information, not investment advice.