The oil comes out of the Gulf, but $30 per barrel goes to transportation and insurance

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The price of oil continues to be high, and in recent weeks it has hovered around $100 per Brent barrel. This is despite the fact that the amount of oil leaving the Gulf is actually higher compared to the months before. Despite Iran’s attempts to attack ships crossing the strait connecting the Persian Gulf to the Indian Ocean, in September the volume of oil exports from the Gulf reached a record of 18.9 million barrels per day, including fuel products. This is a similar level to the volume of exports from the Gulf before the war, excluding Iran. Iranian oil itself is still struggling to get out of the gulf at the current stage, due to the counter blockade imposed by the US.

In October, the volume of exports decreased slightly, to 17.1 million barrels per day on average, but this is also a much higher amount than the Persian Gulf saw throughout the war with Iran.

Nevertheless, the removal of oil from the Gulf did not much calm the prices. At its peak, the price of a barrel of Brent reached more than 110 dollars. Now, amid hopes for talks between the US and Iran, the price has dropped to about $97, but it is still significantly higher than the price at the beginning of 2026, which was about $60 per Brent barrel.

1.2 million dollars for passage through the Straits

The Americans launched a dedicated operation at the beginning of September against Iran’s detection, surveillance and fire capabilities in order to reduce the risk. In addition to this, in the last two months the oil exporters have tripled the price they are willing to offer for passage in Hormuz, to a level of over 1.2 million dollars per sailing day. Before the war, such a day’s sailing carried a price tag of several tens of thousands of dollars.

Such a high price became especially tempting, that shipping companies such as the Korean “Sinocor” began to make regular oil transfers with transmitters and lights off. They load the oil ship-to-ship off Hormuz, then return for another round. This strategy works, but their ships have already been hit by Iranian fire.

This comes, as mentioned, with a significant price tag: before the war, the average transportation and insurance cost together stood at a few dollars per barrel, and now it has jumped 20 times to dozens of dollars per barrel. According to OPEC estimates, about 30% of the cost of oil to the final consumer comes from transportation and insurance costs, which are supposed to compensate the shipping companies and their insurance companies for the significant risks they take when they travel through hostile Iranian waters, and may be hit by missile and UAV fire.

According to OPEC, “the unusually high costs, in turn, are passed on to the entire value chain. They add and prolong the price burden on the producing and consuming countries, adding more inflationary pressures on the global economy.”

So it seems that while the market mechanism manages to successfully extract oil from the Gulf, and continue to drive the global economy, it does not come for free. Those who suffer from this are both the consumers, who pay a higher price for oil and fuel, and also the producers, who in fact receive an oil price similar to that on the eve of the war, and do not benefit from the increase in oil prices that the war led to. Those who do benefit from this are oil producers in other countries, such as the USA, Africa and South America.