Mid-East Tensions, Med Pipeline Deal Shape Global Oil Landscape

Global oil markets remain under pressure as a key shipping chokepoint stays effectively closed, while a major pipeline project moves forward in the Eastern Mediterranean, according to recent reports.

The Strait of Hormuz, a waterway that handled about a fifth of the world’s oil and liquefied natural gas before recent conflicts, is still largely shut despite a fragile ceasefire in the Middle East, Rigzone reported on April 10. Traffic has shown little sign of a meaningful pickup since the truce began, with only a rare Russian-flagged supertanker passage noted late on April 9. The ongoing blockage has maintained pressure on oil prices, which traded at about $95 a barrel in London on Friday, April 10.

U.S. and Iranian delegations were set to meet in Islamabad on Saturday, April 11, with shipping through Hormuz a central sticking point, according to the report. U.S. President Donald Trump criticized Iran's closure of the strait in a Truth Social post on April 9. The broader Middle East war has damaged energy infrastructure across the Persian Gulf in the past six weeks, choking global fuel supplies.

In the Eastern Mediterranean, the Aphrodite consortium led by Chevron Corp. has secured commitments to execute agreements for a new pipeline to Egypt, Rigzone reported separately on April 10. The parties agreed to a term sheet and a host government agreement (HGA) to enable the piped export of 100 percent of production from the Aphrodite gas field, located mainly in Cypriot waters.

The deal envisions a binding sales agreement with Egypt's state-owned EGAS for at least 15 years and up to 20 years. Export volumes would be increased to 700 million cubic feet per day after at least six years from the start of commercial supply. A special purpose company, Aphrodite Midstream Co., will be incorporated in Egypt to build the pipeline, with the Egyptian government confirming its full commitment to support the project. The field's best estimate of contingent natural gas resources was recently increased to 3.67 trillion cubic feet.

Meanwhile, in the Gulf of Mexico, Occidental Petroleum Corp. announced an oil discovery at the "Bandit" well in Green Canyon Block 680, about 125 miles south of the Louisiana coast, Rigzone reported on April 10. The discovery encountered high-quality, oil-bearing Miocene sands and has the potential for subsea tie-backs to existing infrastructure. Occidental operates the discovery with a 45.375 percent stake, alongside partners Chevron (37.125%) and Woodside Energy Group Ltd. (17.5%).

For Bakken operators and royalty owners, the sustained closure of the Strait of Hormuz supports a firmer global crude price environment, which is critical for the economics of North Dakota's shale plays. However, the advancement of major international pipeline projects like the Aphrodite-to-Egypt line underscores the continued global competition in energy infrastructure development and market access. The domestic discovery in the Gulf of Mexico also highlights ongoing investment in U.S. oil supply, contributing to national energy security.