Ghost Fleet and Secret Shipments Keep Global Oil Markets Stable During Hormuz Blockade

President Donald Trump claimed last week that a secret US mission moved 100 million barrels of oil through the Strait of Hormuz during its blockade. The industry, already consumed by the question of how much oil actually escapes the region, cannot answer that claim with confidence. The question has exposed a vast network of covert operations and alternative routes that nobody fully understands.

“No one’s experienced this kind of disruption,” said Matt Stanley, head of market engagement at Kpler, the commodity intelligence and ship-tracking firm. The numbers remain so difficult to pin down because of what the industry calls the dark trade-vessels running without their AIS transponders on, moving at night, closer to the Omani border, sometimes with naval escort. The scale of these shadow operations continues to elude even the most sophisticated tracking systems.

Different grades of crude oil can only originate from specific fields, offering one method to detect portions of outgoing supply. The UAE’s Murban crude can be exported via Fujairah, outside the strait, while another type called Upper Zakum cannot. One oil market analyst noted that their team has seen Upper Zakum crude oil appear in other markets. Those sightings are happening, yet the scale remains unknown.

Trump’s Numbers Put in Context

Stanley says it’s possible that 100 million barrels made it through the Strait of Hormuz since the first of May. He puts that figure in perspective with a striking comparison that reveals both the achievement and the shortfall. Before the conflict, about 20 million barrels a day flowed through the strait, making Trump’s claimed volume equal to roughly five days of normal traffic-except it took over a month to move.

“100 million barrels, it’s a good number, but it’s a relative drop in the ocean, literally, compared to previous traffic,” Stanley explained.

Around 20 million barrels of oil per day traversed the Strait of Hormuz before the war with Iran began. That accounted for about 25 percent of the global seaborne oil trade and around 20 percent of the total global supply. According to tanker tracking data, oil flows through the strait have slowed to a trickle since the war began, yet that trickle might be bigger than first thought.

Why Markets Haven’t Collapsed

The world’s most critical oil chokepoint has been effectively closed for more than 100 days. World Trade Organization data shows a 95 percent reduction in crude oil shipments from Arabian Gulf ports and a 99 percent reduction in liquified natural gas carriers. The International Energy Agency has called it “the largest supply disruption in the history of the global oil market.” Yet Brent crude sits at $87.55 per barrel-the lowest since before the conflict began.

This stability exists because of buffers that have absorbed the shock. China has approximately 1.3 billion barrels in storage and draws it down at around one million barrels a day, Stanley says. Chinese demand sits at about 7 million barrels a day from May through July, down dramatically from the 12.5 million barrels a day they purchased in December. The US, Brazil, and Canada have also stepped in to fill part of the void.

China’s Unexpected Role in Stabilizing Prices

China is normally the world’s top crude oil importer, and it sources much of that oil from Iran and other countries in the Middle East. China’s imports have fallen from around 11.6 million barrels a day to around 7.8 million, the lowest levels since 2017. To put it simply, millions of more barrels per day remain available for other countries to import than anyone thought possible-good news for every other economy in the world.

“If I knew nothing else about what was going on and I was just looking at my data, I would assume there had been a demand collapse on par with the Covid-zero lockdowns,” said Rory Johnston, a Toronto-based oil market researcher, referring to the draconian policies the Chinese government imposed during the pandemic. “But that’s strange, because I haven’t seen any news about China relocking down its economy.”

China’s economy hasn’t cratered, making the import reduction all the more remarkable. The country appears to be strategically managing its reserves and reducing consumption to help stabilize global markets, though whether this represents altruism or strategic positioning remains unclear. The three analysts interviewed agree that the oil market’s response has been robust, with multiple mechanisms working in concert to prevent the predicted crisis.

Alternative Routes and Ghost Operations

Pipelines bypassing the Strait of Hormuz help offset some of the supply gap. Saudi Arabia’s 7 million BPD East-West Pipeline and the 1.8 million BPD Abu Dhabi Crude Oil Pipeline provide critical alternative routes. Meanwhile, higher oil prices cause some demand destruction as consumers adjust their behavior. The world makes up the remaining shortfall by drawing down excess inventory and tapping emergency stockpiles, such as the U.S. Strategic Petroleum Reserve.

However, many oil market analysts believe that substantial volumes of oil continue to move through covert means. Some ships pay tolls to Iran while others quietly escape the strait at night with their transponders off. These workarounds have helped keep oil prices from spiraling out of control. While Brent oil, the global benchmark, surged from its pre-war level of around $70 a barrel to a high above $114, it never reached the $200 per barrel many analysts predicted.

Looking Ahead at Supply Realities

Gas prices currently run roughly a dollar more than they were last year for Americans. Considering the severity of the crisis, they could be significantly higher-some analysts predicted gas in the $6.50 to $7 per gallon range if oil hit $200 a barrel. Instead, oil currently trades at less than $90 a barrel, and the long gas lines many anticipated have not materialized.

The combination of ghost fleet operations and alternative pipeline routes creates one cushion. Strategic reserve drawdowns provide another buffer, while China’s dramatic import reduction creates unexpected breathing room. Together, these factors have prevented what the International Energy Agency called the most severe oil supply shock in history from destabilizing the global economy. The question now becomes how long these buffers can last before inventory levels drain to critical minimums and prices surge toward the levels analysts originally feared.