Almost half the world's oil now comes from countries caught in conflict, six months into the Iran war that Reuters calls the largest oil supply crisis on record. Refining capacity has fallen by roughly a tenth, Russia has banned fuel exports, and Qatar is pushing for a return to normal shipping through the Strait of Hormuz.
Six months after U.S. and Israeli strikes on Iran touched off the crisis, almost half the world's oil supply comes from countries hit by conflict, and there is still no clear end in sight. The disruption has outgrown previous energy crises.
War zones now account for 43% of global supply
Countries affected by the Iran war, the Russia-Ukraine conflict, fighting in Libya and U.S. restrictions on Venezuelan exports together produced about 45 million barrels per day in 2025, more than 43% of global supply, according to Reuters calculations based on International Energy Agency data. The Russia-Ukraine war has also forced production and refining cuts this year, including in nearby Kazakhstan.
Saudi Arabia has rerouted oil to the Red Sea, and Gulf exporters have quietly moved barrels out of the Strait of Hormuz. As a result, the current Gulf oil disruption stands at roughly 5 million to 7 million barrels per day, analysts estimate. Risks to total flows remain high, though, as attacks near the Red Sea and Egypt's Suez Canal in July showed.
Refining losses push diesel to record highs
The conflicts in the Gulf and Ukraine have also cut global refining capacity by about a tenth. Ukraine has targeted much of Russia's refining network, striking plants as far away as Omsk, roughly 2,700 km from Ukrainian-held territory. Russia, facing fuel shortages, has banned gasoline and diesel exports, tightening global fuel markets.
As a result, U.S. diesel prices have climbed to record levels even as refiners run at peak capacity. Higher fuel costs have become a key driver of inflation, contributing to higher borrowing costs and helping push U.S. debt to a record $40 trillion. The IEA has released record volumes from emergency stockpiles to cushion the shock, but those releases are now largely complete even as global inventories keep declining.
Qatar pushes for normal shipping through Hormuz
Amid the strain, Qatar's Foreign Ministry has urged a return to normal conditions in the Strait of Hormuz, stressing the need to protect freedom of navigation through the waterway. Qatar and other Gulf states continue to back safe transit and de-escalation, but Iran has linked reopening the Strait to broader negotiations, while the U.S. is demanding an end to hostile actions first.
Separately, the probability of a U.S.-Iran agreement by August 31 rose to 3.8% from 2% in the prior 24 hours, Crypto Briefing reported, while longer-dated contracts for September 16 and October 1 priced the odds higher, at 7.5% and 18%, respectively.
Sources: Commodities & Futures News, Crypto Briefing
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