World has lost 2.6 billion barrels of oil since US-Iran war began, Aramco CEO warns
The world has lost more than 2.6 billion barrels of oil since the U.S. war with Iran began in February, according to the head of Saudi oil giant Aramco.
CEO Amin Nasser said Tuesday that the loss is equal to nearly one month of normal global crude production, highlighting how much the closure of the Strait of Hormuz has disrupted the world’s oil supply.
“If the Strait were to open today, it would take up to 18 months at an average rate of 2.1 million barrels a day to replenish depleted inventories,” Nasser said while discussing Aramco’s second-quarter earnings.
His comments come as countries continue drawing from strategic petroleum reserves and oil companies look for ways to keep supplies moving despite the ongoing conflict.
Aramco reported a 44% increase in quarterly net profit to $32.69 billion, helped by higher oil prices and its ability to reroute shipments through Saudi Arabia’s East-West Pipeline instead of the Strait of Hormuz.
Nasser said attacks on some Aramco facilities caused temporary production interruptions, but he said they did not have a material impact on the company’s operations or finances. He credited the company’s storage network, export terminals and pipeline system with helping keep oil flowing.
He also said releases from strategic reserves, commercial inventories and lower demand have helped ease some of the pressure on global markets.
Nasser, however, warned the market has little room for another major disruption.
Refineries around the world are already running near full capacity, he said, and a prolonged refinery outage or another supply interruption could tighten fuel supplies even further.
If conditions improve, Nasser said Aramco could restore production to pre-conflict levels within days and reach its maximum sustained production capacity of 12 million barrels per day within three weeks if requested.
Reuter contributed to this report.
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