Middle East Conflict Drives Global Oil Supplies to Brink
The ongoing conflict in the Middle East is taking a toll on oil supplies worldwide. Even if a peace deal between the US and Iran is reached, it will take weeks for oil shipments to resume from the Gulf region and reach refineries globally.
Oil companies are depleting their storage tanks to meet peak summer demand, while commercial stockpiles and emergency reserves have been used up to offset the shock of the war. The full impact of the disruption has yet to be felt, with Middle East production and exports expected to return to pre-war levels in many months.
Globally, crude stockpiles are expected to drop to their lowest since 2018, according to Goldman Sachs. This would stress the global energy system and prolong the time it takes for oil producers and refiners to relieve supply shortages and high fuel prices to return to pre-war levels.