Aramco CEO Warns of Dangerously Low Global Oil Inventories

Saudi Aramco CEO Amin Nasser raised alarm over the state of global oil inventories, calling them 'scarily thin' due to the loss of nearly 3 billion barrels of supply since the Iran war began. This loss is roughly equivalent to half the crude and products that would normally pass through the Strait of Hormuz. Despite some recovery in Middle East crude flows, the world's commercial inventories have dwindled to less than 6 billion barrels, with most of these reserves not practically accessible.

Nasser warned that the system is already under strain, noting that Brent crude prices could have surged to $200 per barrel without Saudi Arabia's East-West pipeline. This pipeline allows crude to bypass the Strait of Hormuz, and Aramco has restored about 80% of its capacity after a recent attack. Replenishing inventories while meeting global demand could take up to two years, even after the Strait of Hormuz fully reopens.

His warning follows the G7's decision to release up to 100 million barrels of emergency oil and diesel stocks over the next four months. While these reserves might provide a temporary buffer, Nasser emphasized that they cannot address long-term supply issues. Aramco is exploring additional export routes and overseas storage to reduce reliance on specific shipping corridors and can activate its full 12 million barrels per day of sustainable production capacity within days.