The CEO of Abu Dhabi National Oil Company (ADNOC), Sultan Al Jaber, said on November 2 that global oil inventories have fallen by 1 billion barrels since shipping through the Strait of Hormuz was disrupted by the US-Israel-Iran conflict that began in late February.
Speaking at the Abu Dhabi International Petroleum Exhibition and Conference, Al Jaber said diesel inventories in some regions have dropped to 35-year lows, and LNG supply gaps in some regions have reached 16.99 billion cubic meters.
'We need to expand strategic reserves, increase product inventories and build more flexible refining capacity closer to consumer markets... Infrastructure must be built before it is needed, supported by advanced logistics,' he said.
Brent crude futures recently topped $110 a barrel, up about 50% from before the Iran conflict broke out. Al Jaber said shipping and logistics costs have risen to 30% of the cost of a barrel of oil, versus 5% before the conflict.
According to the International Energy Agency, observable global oil and product inventories stood at about 8.2 billion barrels before the US and Israel launched military strikes against Iran on February 28, including government emergency reserves, commercial stocks and oil on tankers at sea.
The IEA announced on March 11 that its 32 member countries unanimously agreed to release 400 million barrels of strategic petroleum reserves to ease the global supply crunch. On October 15 it announced again that releases would exceed the original 400-million-barrel commitment, with members accelerating releases; the IEA has agreed to take all necessary measures to complete the remaining 100 million barrels, including releasing more than 20 million barrels of diesel.
