Oil Executives Warn of Multi-Year Market Turmoil and Supply Shortages

Top oil executives warn that global market turmoil could persist for years, driven by persistent supply disruptions and declining inventories. Amin Nasser, CEO of Saudi Aramco, stated that replenishing depleted global stockpiles, drawn down as an emergency measure, could take up to two years. The crisis stems from the closure of the Strait of Hormuz after the US-Israeli war on Iran, which has choked off key shipping routes and exacerbated production disruptions due to attacks on energy infrastructure.

Kuwait Petroleum CEO Shaikh Nawaf Al-Sabah highlighted a staggering shortfall of 6 million barrels per day of refined products, noting that global refining capacity is insufficient to compensate for lost output in the Middle East. Meanwhile, Kuwait’s crude oil exports have held steady at around 1 million bpd, even as production has dropped from 2.6 million bpd to 2 million bpd due to war-related challenges.

ConocoPhillips Executive Chair Ryan Lance projected a delayed recovery in global oil demand, suggesting it may not fully rebound until 2028 or 2029. He also forecasted a rise in the US oil price floor for WTI crude to around $70 per barrel, with a mid-cycle price range of $65 to $70. If prices remain strong, US oil production could exceed 14 million to 14.5 million barrels per day, although specific thresholds for “strong” prices were not defined.

As of Monday, Brent crude futures traded just above $100 per barrel, while WTI was close to $90 per barrel. Executives emphasized that the turmoil will likely extend well into 2027, with Petronas CEO Tengku Muhammad Taufik describing the situation as ‘bedlam’ for the foreseeable future.