Saudi Aramco CEO warns Western oil inventories near depletion limits
- Global energy markets face a critical squeeze as Western crude inventories near depletion following eight months of armed conflict between the United States and Iran, according to industry...
- Commercial inventories accessible to the market have dropped to critically low volumes, leaving less than 6 billion barrels of total commercial storage globally, according to Amin Nasser, CEO...
- Emergency measures used since February, including massive strategic reserve releases and severe demand cuts, are reaching operational limits.
Global energy markets face a critical squeeze as Western crude inventories near depletion following eight months of armed conflict between the United States and Iran, according to industry executives gathered at the Energy Intelligence Forum in London. While international benchmark Brent crude trades below 100 dollars per barrel due to aggressive emergency stock releases and production boosts, top energy traders warn that these operational buffers have nearly hit their absolute limits.
Reserves Hit Critical Depletion Levels in Western Nations
Commercial inventories accessible to the market have dropped to critically low volumes, leaving less than 6 billion barrels of total commercial storage globally, according to Amin Nasser, CEO of Saudi Aramco. Nasser reported at the London forum that the vast majority of those remaining stocks are practically unavailable, putting the entire system under intense pressure after nations withdrew more than 1 billion barrels from terrestrial storage since the Middle East crisis began.
Emergency measures used since February, including massive strategic reserve releases and severe demand cuts, are reaching operational limits. Vitol CEO Russell Hardy emphasized that Western economies hold no remaining inventories to exhaust, stating that between 10, 12, and 14 million barrels must exit maritime routes to maintain winter equilibrium.
Menos de 6 mil millones de barriles de inventarios comerciales quedan hoy, y la gran mayoría no está prácticamente disponible, por lo que el sistema ya está bajo presión.
Amin Nasser
Strait of Hormuz Disruptions Threaten Global Refined Fuel Supplies
Although tanker traffic through the Strait of Hormuz—a crucial maritime corridor carrying roughly one-fifth of global oil and liquefied natural gas—has partially recovered toward pre-conflict levels, system vulnerability remains at a peak. Shell CEO Wael Sawan cautioned that temporary shock absorbers have limits, noting that such measures only work for a finite period before new interruptions occur.
Refined fuels face the sharpest vulnerability, particularly diesel, which has recorded price spikes outpacing crude itself. Kuwait Petroleum Corporation estimated that global markets currently face a shortage of approximately 6 million barrels of refined fuel daily due to severe disruptions in Middle East refining capacity.
International Energy Agency Plans New 100 Million Barrel Injection
To combat surging diesel costs and approaching winter demand, the International Energy Agency is preparing to release 100 million barrels of crude and diesel. This upcoming injection stacks on top of a prior 400 million barrel authorization launched in March, though market participants question how much of that earlier volume remains undelivered.
Amin Nasser criticized the scale of the intervention given the depleted state of global buffers, remarking on the protracted negotiations required to secure the release. The 100 million barrel injection will help cushion winter consumption, but it will erode strategic reserves even further.
Tomó muchas negociaciones, pero son 100 millones. Los inventarios están alcanzando un nivel de tensión. Solo el 10% o menos está disponible, por eso tienen dificultades con 100 millones de barriles.
Amin Nasser
Long-Term Supply Pressures Persist Despite Price Stability in Asia
Despite the severe supply constraints in Western markets, crude prices in Asia fell on October 6, as steady Middle East exports and G7 emergency releases temporarily eased immediate concerns, according to Vietnam.vn. Brent crude dropped 83 cents to 99.49 dollars per barrel, while West Texas Intermediate fell 1 dollar to 88.43 dollars per barrel.
Even with maritime traffic through the Strait of Hormuz showing signs of stabilization, industry leaders maintain that restoring depleted emergency reserves could take up to two years. Kuwait Petroleum Corporation points out that balancing regular consumption alongside long-term inventory replenishment will keep global energy supplies under sustained pressure.