‘Quiet’ Hormuz crude flow, lack of products have split oil market: TotalEnergies CEO
TotalEnergies CEO Patrick Pouyanne details a bifurcated market where crude flow persists through Hormuz despite disruptions, even as global refined product supplies face significant tightening.
According to a report in Hellenic Shipping News, TotalEnergies CEO Patrick Pouyanne described a split oil market during the ONS conference in Stavanger. While crude oil continues to transit the Strait of Hormuz through discreet arrangements, refined products are facing greater obstacles. This dynamic has created a bearish environment for crude fundamentals while leaving the fuel market bullish due to significant supply shortages of refined liquids.
Pouyanne noted that crude exports from Iraq and Qatar are moving at a premium of roughly $10 per barrel to cover specialized shipping costs, though producers are pricing oil lower to ensure market access. However, refined products typically utilize smaller vessels, making the per-barrel transport costs prohibitive. Furthermore, the supply of products has been reduced by 6 million barrels per day, split equally between Hormuz disruptions and Ukrainian strikes on Russian refineries.
The executive acknowledged that the industry had previously overlooked the risks associated with the Strait of Hormuz as a single exit point. Consequently, TotalEnergies intends to diversify its infrastructure by investing in alternative export routes. These projects include a pipeline connecting Baghdad to Syria and a capacity expansion at the Fujairah terminal in the United Arab Emirates, which sits outside the vital maritime chokepoint.
Beyond oil, Pouyanne highlighted growing concerns in the natural gas sector. He warned that high prices linked to regional conflict are causing price-sensitive buyers of liquefied natural gas to lose confidence in the fuel. These consumers are increasingly considering coal as an alternative. Data indicates that benchmark LNG prices have surged by more than 120 percent since the onset of the current conflict in early 2026.
Helena Marsh — Energy Markets Editor. Helena covers crude, refined products and the trading houses that move them, with a focus on price formation in the Mediterranean and Black Sea.
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