Oil executives say the global fuel crisis they had long warned about has now arrived, with commercial fuel stocks depleted for months and strategic reserves largely exhausted. Diesel has hit record highs and crude trades near $101 a barrel after a Saudi pipeline attack stranded millions of barrels a day, even as the White House calls the disruption temporary.
American oil executives say the global fuel crisis they had warned about for months has now arrived, according to the Wall Street Journal. Commercial fuel stocks around the world have been depleting for more than six months, and strategic crude reserves cannot be tapped much further, the paper reported, as the prolonged closure of the Strait of Hormuz continues to squeeze supply.
Executives say the buffers are gone
Speaking at an energy conference in Austin, Chevron chief executive Mike Wirth said the mechanisms that had cushioned price and supply risk have largely played out, leaving the market without the buffers it had earlier in the disruption. He added that it is difficult to see prices easing anytime soon. The squeeze has intensified since attacks last week knocked out a major Saudi crude pipeline that had bypassed the Strait, stranding an estimated 2.5 million barrels a day from an already tight market, according to analyst estimates cited in the report.
Diesel hits records as crude nears $101
Diesel prices have climbed to record highs near $6.20 a gallon, while petrol, which had briefly dipped below $4 a gallon earlier this summer, has rebounded to around $4.30. US crude has risen roughly 19% over the past three weeks to trade near $101 a barrel as attacks on tankers and energy infrastructure continue on multiple fronts, including recent Houthi strikes on Saudi infrastructure from Yemen.
Washington calls it temporary
The Trump administration has continued to describe the disruption as temporary, with Interior Secretary Doug Burgum pointing to efforts to boost Venezuelan oil production and expand US refining capacity as the two main levers available to ease prices. Burgum also pushed back on speculation that the White House is considering a temporary ban on US refined product exports, arguing it would not meaningfully help domestic prices. Some energy executives and advisers, however, say they have grown increasingly alarmed as the conflict has escalated again in recent weeks, with China's resumption of larger international crude purchases, after months of drawing down its own reserves, adding further pressure to global supply.
With no resolution to the conflict in sight and Trump reportedly expecting the war to extend at least until the November midterms, energy advisers cited in the report say investors are bracing for the disruption to run well beyond that timeline.
Source: Investinglive RSS Breaking News Feed
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