Iran Oil Exports Near Zero But Peace Deal Not Likely, FGE Says

The US naval blockade has cut Iran’s oil exports to almost nothing. That matters because oil is a key source of Tehran’s revenue, and the blockade is reducing the money available after more than eight months of war. Iran’s economic pain has increased, but it has not broken the negotiating deadlock.

Only about 200,000 to 300,000 barrels a day are still reaching the market through Iraq. Iran loaded no crude onto tankers in September or October, the first such pause since the war began. At least 54 tankers carrying Iranian oil or petroleum products are also idling along the coast.

FGE NexantECA says an imminent agreement is unlikely. Fereidun Fesharaki says Iran is making demands the White House cannot accept and that negotiations are worse than before the June MOU. He also says renewed strikes are highly likely, while Tehran could face a complete loss of incoming money by late November.

Iran is still getting only about 200,000 to 300,000 barrels of oil per day to market. Fereidun Fesharaki says these barrels are moving through Iraq. That is a tiny remaining stream compared with the country’s earlier export activity, although the article does not provide one exact pre-blockade daily total for a direct numerical comparison.

The clearest measure of the collapse is tanker loading. Bloomberg vessel-tracking estimates show that Iran loaded no crude onto tankers in September or October. September was the first month without loadings since the war began in February. Before that halt, China had been the main destination for sanctioned Iranian crude.

The blockade has therefore changed Iran from a regular seaborne supplier into a marginal one. At least 54 tankers are idling near the coast, while only limited flows continue through Iraq and on smaller vessels. Fesharaki predicts that Tehran will be starving financially by the end of November because almost no money is entering.

A naval blockade is a military operation that restricts ships from entering or leaving a country’s ports or nearby waters. Its purpose is to interrupt supplies, trade, or military movement. In this case, the blockade targets Iran’s seaborne oil exports, which are a major source of revenue.

Naval forces can patrol waters near the coast, identify tankers, inspect cargoes, turn ships away, or stop and seize vessels under the rules governing the operation. Tankers may then remain at anchor because owners fear interception, or because routes and port access are closed. The article reports at least 54 tankers idling along Iran’s coast.

The effect can be severe even when some ships get through. Iran loaded no crude onto tankers in September or October, while about 11 ships carrying Iranian liquefied petroleum gas reportedly passed the blockade. Smaller vessels and routes through Iraq still provide limited alternatives, but they cannot replace normal export traffic.

The collapse in oil revenue creates severe pressure because Iran depends on oil sales to bring money into the country. After more than eight months of war, the blockade has nearly stopped that income. Fesharaki says Iran could be starving financially by the end of November, with no money coming in.

Yet financial pain does not automatically produce a peace agreement. Iran may judge that holding firm can improve its bargaining position, especially after the Republican Party’s disastrous midterm performance. Fesharaki says Tehran sees President Donald Trump as politically weakened and is now making demands the White House cannot accept.

The result is a standoff rather than a concession. The blockade is damaging Iran’s economy, but negotiations are reportedly worse than before the June MOU. Fesharaki says renewed strikes are highly likely, suggesting that pressure could lead to further conflict before it leads to compromise.

China’s independent “teapot” refiners are smaller, privately operated oil-processing companies rather than the country’s largest state-linked refiners. The term describes their relatively modest scale and independent position in China’s refining sector. Before the conflict, they were important buyers of sanctioned Iranian crude.

The article identifies the main attraction clearly: Iranian barrels were sold at a discount. That lower price made the crude particularly popular among China’s teapots. The source does not explain their purchasing procedures, specific margins, or how each refiner handled sanctions, so those details cannot be established from this article.

Their role matters because China was the main destination for Iranian oil before the war. With Iran loading no crude onto tankers in September or October, these buyers have lost a significant source of discounted supply. The blockade therefore hurts both Tehran’s revenue and the flow of those barrels into China’s independent refining market.

When large tankers cannot leave, Iran and its buyers can seek narrower channels. The article identifies shipments through Iraq as one route, with roughly 200,000 to 300,000 barrels a day still reaching the market. It also reports that smaller vessels continue to move some products despite the blockade.

The mechanism is simple: smaller ships may attract less attention or fit routes unavailable to large tankers, while overland or regional movement through Iraq avoids some direct coastal exposure. About 11 ships carrying Iranian liquefied petroleum gas successfully passed the blockade, according to United Against Nuclear Iran. These are partial workarounds, not a full replacement.

The limits are visible in the overall numbers. Iran loaded no crude onto tankers in September or October, and at least 54 tankers remain idle along the coast. Alternative routes can preserve a trickle of sales, but they cannot restore the export system that previously supplied China’s independent refiners.

Oil prices respond to expected supply, not simply to whether a war continues. If a major supplier loses exports, available crude can shrink and buyers may bid prices higher. The risk of interruption can also add a premium, as happened when President Trump’s threats of fresh attacks helped push oil to a six-month high in October.

But markets also weigh countervailing signals. If traders believe the war will not remove more supply, alternative shipments will continue, or demand will be weaker, prices can fall. Expectations change quickly when leaders sound less aggressive or when the chance of broader disruption declines. Price movements therefore reflect forecasts as well as current barrels.

That helps explain the article’s contrast. Brent crude fell about 15% this week even though the war continued, after Trump became more restrained following the midterms. The blockade still blocks Iranian exports, but markets judged the immediate threat differently from October.