As the United States and Iran signed a memorandum of understanding (MOU) to end the war and the Strait of Hormuz, which had been effectively blocked for about four months, was recently reopened, the oil exports of the United Arab Emirates (UAE), a major oil producer in the Middle East, have already recovered to more than 85% of the prewar level.
According to the International Energy Agency (IEA) on the 23rd (local time), the UAE's crude oil exports were tallied at 4.3 million barrels a day as of early this month. That is a sharp increase from 1.9 million barrels a day in March, immediately after the war broke out, and about 85% of the prewar level.
A key factor in the UAE's rapid export normalization was its domestic pipeline. The UAE has a 380-kilometer pipeline connecting Habshan, a crude production hub, to the port of Fujairah on the Gulf of Oman. Designed to transport crude produced in Abu Dhabi fields directly to export terminals without passing through the Strait of Hormuz, the pipeline has a maximum capacity of 1.8 million barrels a day.
In addition, the UAE operates Mandous, an underground crude storage facility near Fujairah with a capacity of 42 million barrels. The IEA said the facility provided additional flexibility for managing export volumes and loading schedules, supporting the UAE's export recovery.
Even during the war, the UAE did not completely halt exports through the Strait of Hormuz. From April, it transported some export volumes through the strait along Oman's coastline, using a practice of turning off tankers' transponders (position transmitters) during operations.
In particular, Abu Dhabi National Oil Company (ADNOC) used its own fleet to continue shipping crude and gas cargoes beyond the Persian Gulf. Bloomberg News reported that these vessels appeared to have obtained passage permission from both the Iranian navy and U.S. warships to head to customer countries suffering from energy shortages.
ADNOC is regarded as one of the most successful energy companies in maintaining its export network in the Middle East by using so-called "dark voyages," which involve turning off transponders when ships pass through the Strait of Hormuz. Thanks to such methods, ADNOC remained one of the most active crude and gas shippers in the Middle East during the war, and it also used small tankers to move crude beyond the strait.
Bloomberg News said, "The UAE's shipping method was among several workarounds that prevented international oil prices from surging amid the supply crisis," adding, "Contrary to industry pessimism that prices could soar to $200 a barrel, prices stayed relatively stable because crude volumes through the Strait of Hormuz were steadily maintained, U.S. crude exports hit a record high, and China's demand slowed much more than expected."