Middle East oil and gas recovery faces months-long process despite ceasefire in Oil & Companies News 10/04/2026 The 11 million b/d of upstream production currently shut-in across the Middle East can only be restored when export logistics normalise, according to Wood Mackenzie. Initial stages of oil supply recovery “A ‘workable system’ of transit and shipowner confidence in the security of the transiting vessels is essential,” said Alan Gelder, SVP Refining, Chemicals and Oil Markets at Wood Mackenzie. “This includes availability of insurance for transiting vessels, facilitating commercial trade financing, sustained outbound vessel transits through the Strait of Hormuz making current oil on water available to the global refining market, and sustained inbound vessel transits through the Strait making ballasting vessels available to load crude at Gulf load ports. There also needs to be confidence in viability of transit during and beyond the current two-week ceasefire.” Laden vessels have every incentive to transit the Strait of Hormuz as quickly as insurance and security assurances allow, but it is unclear what rate of transits can be achieved safely. “Ballasting vessels are unlikely to enter via the Strait of Hormuz any sooner than a ‘just in time’ logistics basis, at risk of becoming trapped if hostilities resume,” Gelder added. “Onshore storage drawdown remains constrained by over-the-jetty load rates, onshore inventories cannot be instantaneously transferred to ballasting vessels.” Secondary stages of oil recovery As export volumes ramp up, storage ullage will allow upstream production and refining operations to resume. The level of storage varies from around a month for Saudi Arabia and the UAE, to less than two weeks for Iraq and Kuwait. “The initial recovery from major fields will be more than sufficient to meet the ramp-up of export volumes. Shipping logistics will remain the constraint on upstream recovery for several weeks,” said Fraser McKay, Head of Upstream Analysis at Wood Mackenzie. “Thereafter, as those constraints begin to ease, the constraints on supply will shift to the upstream production, and this will expose the different challenges each country faces. More than half of most field’s previous supply levels could be restored before shipping constraints ease. Thereafter, different recovery profiles will emerge.” McKay noted that even unconstrained, it will take countries like Iraq a long time to reach prior production levels—as long as between 6 and 9 months—given the complexities involved, due to both reservoir management and resource constraints. In other countries, while there is little damage to upstream infrastructure, local demand centres (i.e. refining capacity) could require repair. So even though exports will ramp-up, previous production highs will take much longer to reach. “There are a couple of silver linings of these shut-ins,” McKay said. “The first is, this is the largest and longest build-up test—though not how they would typically be undertaken—in history, so reservoir engineers will have more data to incorporate into optimisation plans. The second is reservoir pressures tend to rebalance with time, and so pressure around producing wells will have increased, helping the deliverability of these wells during their recovery.” Most or all of these operators will have had a contingency plan in place before war broke out. This will have been adapted as events unfolded, so if and when the uncertainty around ex