LONDON, U.K.: Even if the United States and Iran strike a deal to end the war in the Middle East, global oil supplies are expected to remain under pressure for months as depleted inventories, shipping delays, and disrupted refining capacity continue to strain markets during peak summer demand.
The world has relied heavily on emergency reserves, commercial stockpiles, and oil held in transit or at sea to cushion the impact of the conflict, but analysts and industry executives warn that those buffers are shrinking rapidly.
Executives from major energy companies and analysts say the full effect of the disruption has yet to filter through to consumers and the wider economy because Middle East production and exports will take months to return to pre-war levels.
The drawdown in inventories has come at a time when stockpiles would normally be increasing ahead of the Northern Hemisphere summer, when demand rises due to travel, farming, and freight activity.
Goldman Sachs said global crude inventories could fall to their lowest levels since at least 2018, even if supplies through the Strait of Hormuz begin recovering soon.
That would prolong supply shortages and keep fuel prices elevated even after hostilities ease, analysts said. “Even if the conflict, and I hope so, will end in May, we would exit the conflict with clearly some very low inventories,” Patrick Pouyanne said last week.
The TotalEnergies chief executive estimated that stock draws of 10 million to 13 million barrels per day had already consumed at least 500 million barrels from global inventories.
For comparison, the United States currently holds about 460 million barrels of crude oil in its inventories.
Anders Opedal, CEO of Equinor, said it could take at least six months for oil markets to stabilize even if peace is restored soon.
U.S. President Donald Trump has said prices would fall quickly once the conflict ends. Hopes for progress in U.S.-Iran talks helped push benchmark Brent crude futures down 7.8 percent on Wednesday to US $101.27 a barrel.
Still, analysts said physical crude and gasoline prices are likely to remain elevated for some time because restoring supply chains will be slow.
A Reuters poll last week forecast Brent crude would average $86.38 a barrel this year, up sharply from around $62 in January.
Demand could also rise further after the war ends as governments and companies rebuild depleted stockpiles and restart production facilities.
Australia, which imports around 80 percent of its fuel and has experienced shortages during the conflict, said this week it would spend $7.22 billion to expand fuel reserves.
Since late February, when the war began, global oil inventories have fallen sharply. Goldman Sachs expects stockpiles to decline to around 98 days of demand by the end of May, down from 105 days at the end of February.
Rystad Energy estimates the world has already lost around 600 million barrels of oil supply. If shipping disruptions persist through May, total lost supply could rise to between 1.2 billion and 2 billion barrels.
“It’s obvious to most that if you look at the unprecedented disruption in the world supply of oil and natural gas, the market hasn’t seen the full impact of that yet,” Darren Woods said during an analyst call last week. The Exxon Mobil chief executive said it could take one to two months for oil flows to normalize after the Strait of Hormuz reopens.
Natural gas supplies have also been hit hard after the shutdown of Qatar’s liquefied natural gas production and damage caused during the conflict.
Rystad Energy estimates global LNG supply losses could total between 30 million and 50 million tonnes, equivalent to up to 11 percent of annual global supply.
Morgan Stanley warned U.S. gasoline inventories could fall to around 198 million barrels by late summer, the lowest seasonal level in the bank’s records.
Europe could also face jet fuel shortages as early as June if disrupted Middle East supplies are not fully replaced, according to the International Energy Agency.
Even after shipping routes reopen, analysts said recovery will be gradual because refinery outages in the Middle East continue to restrict fuel production.
Fuel supplies from the region remain critical for markets in Europe, Africa, and Asia, all of which are facing growing pressure from the prolonged disruption.
