Global Oil Supply at Record Crisis Levels as Conflict Zones Account for Almost Half of Global Output

The global oil supply is facing its largest crisis on record, with nearly half of the world's oil coming from conflict-affected countries. According to Reuters calculations, six months after US and Israeli attacks on Iran triggered the crisis, no clear end is in sight.

The ongoing conflicts in Libya, Russia-Ukraine war, and US restrictions on Venezuelan oil exports have collectively produced around 45 million barrels of oil per day at 2025 production levels, accounting for over 43% of global supply. This has increased the world's reliance on US oil supplies, although even that has been disrupted by extreme weather conditions.

Analysts estimate that the current disruption in Gulf oil supplies is around five to seven million barrels per day. The Saudi Arabia's diversion of oil to the Red Sea and Gulf exporters secretly moving oil through the Strait of Hormuz have further complicated the situation. Risks to overall oil flows remain high, with attacks on the Red Sea and near Egypt's Suez Canal in July demonstrating ongoing security threats.