Global Oil Markets Remain Under Pressure Amid Disruptions and Tight Supplies

Oil supply disruptions are widening market deficits amid tight physical supplies and geopolitical tensions. Pulkit Agarwal, Global Director of India Content at S&P Global Energy, warned that continued disruptions could further exacerbate the existing deficit. He noted that oil prices have moved through several peaks and declines as markets assessed when ongoing conflicts would end and normal oil flows could resume.

Agarwal stated that supply-side challenges have affected global oil and gas markets for over six months. Physical oil supplies remain tight, with record cracks in diesel contributing to the issue. He added that some oil is still flowing through the Strait of Hormuz, but the global market remains under pressure.

Agarwal also discussed India's dependence on Russian oil, noting that it has remained an important part of the country's oil demand equation since the Russia-Ukraine conflict began in 2022. He stated that removing a major supplier like Russia would be difficult for any importing country, particularly when physical markets are already tight.