Oil markets are entering uncharted territory, with the closure of the Strait of Hormuz now well into its third month. Even with an extremely fragile ceasefire still largely in place, the economic impact of the conflict shows no sign of letting up. Oil export losses from the Middle East now top 800mn barrels, and the IEA Executive Director Fatih Birol raised the prospect this week of another release from strategic inventories.
Mr Birol’s comments come as the impact of the supply losses on global inventory levels has become increasingly visible. Morgan Stanley this week noted that global oil inventories were drawn down by 24.1mn barrels last week, pushing them below the five-year average and with no indication that the rate of decline is slowing. Draws were evident in crude oil and refined products across all regions. (CONTINUED – 1032 WORDS)
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