Iran’s floating oil storage nearly empty as US naval blockade persists
Iranian crude held in floating storage has fallen to under 1 million barrels by mid-October, down from roughly 150 million barrels before Washington's blockade began in April, according to Kpler data.
The decline was not steady. Floating storage had already dropped to under 50 million barrels by mid-June, when the United States lifted the blockade after a ceasefire was reached between Washington and Tehran. That truce broke down in mid-July, hostilities resumed, and the blockade was reinstated, after which stored volumes kept falling to 866,000 barrels by mid-October.
Kpler’s head of crude oil analysis, Homayoun Falakshahi, said there is effectively no oil left to unload to China, Iran’s main buyer. He said Washington may be betting that economic pressure will either force Tehran back to the negotiating table over its nuclear program or trigger internal unrest the regime would struggle to manage.
The pressure is not one-sided. US fuel prices, particularly diesel, remain near record highs, and President Donald Trump’s approval ratings have slipped ahead of November’s midterm elections.
Iran’s central bank governor rejected suggestions that the economy is near collapse, describing such claims as an illusion and pointing to the economy’s resilience. Iran’s president and foreign minister have separately said this week that distrust of the United States makes renewed peace talks difficult. Moody’s recently estimated the total cost of the Iran conflict to US households at $265 billion.
Why it matters for markets: A tighter blockade that cuts off Iranian supply to China reduces global crude availability, a factor that can support oil prices including Brent crude and WTI crude. Persistently high US diesel costs also feed into broader inflation readings that influence Fed policy expectations and the dollar.
Source: OilPrice.com