The world’s oil pantry is running dangerously low, and everyone is trying to restock at the same time. The Iran war has effectively shut down tanker traffic through the Strait of Hormuz, the narrow chokepoint that normally handles roughly a fifth of the world’s petroleum supply, and the consequences are rippling through every corner of the global economy.
The International Energy Agency reports that global oil inventories fell by 250 million barrels over March and April alone. That works out to roughly 4 million barrels per day vanishing from stockpiles.
A billion barrels and counting
More than 14 million barrels per day of oil production has been shut in since the conflict disrupted Gulf shipping lanes. Cumulative losses from Gulf producers now exceed 1 billion barrels.
The IEA has warned that price volatility could persist, particularly as peak summer fuel demand approaches.
