The war in the Middle East might be drawing to a close, but one of the largest energy disruptions in history still needs some time to iron out the kinks.
The researchers wrote that shipping headaches, high insurance costs, and operational caution are likely to be the main constraints moving forward, even if oil production capacity swiftly returns to pre-war levels.
Among the primary Gulf exporters, Saudi Arabia and the United Arab Emirates are expected to recover at the faster end of the range, given their high-quality reservoirs and infrastructure, as well as existing export pipeline capacity that can bypass the strait. Countries with more outdated infrastructure, such as Iraq, are expected to recover more slowly.
Other research has come to a similar conclusion: The bulk of operational capacity might recover in the coming months, assuming future flare-ups are avoided, though a full return to pre-war production levels will likely take longer. Capital Economics estimated on Monday that around 80% of energy flows could resume by the third quarter of 2026, but a “return to ‘normal’” won’t happen until 2027.
