London, Oct. 5 (SANA) Global oil inventories could take as long as two years to rebuild even after the Strait of Hormuz fully reopens, Saudi Aramco Chief Executive Amin Nasser said on Monday, warning that the world’s oil supply buffer had become dangerously thin.
“The system is already under strain,” AFP quoted Nasser as saying at the Energy Intelligence Forum in London.
“With few other options available to the world, the safety margin for ensuring supply stability has become worryingly thin,” he said.
Nasser said constraints were affecting both crude oil and refined products and that pressure on global markets was likely to persist until the Strait of Hormuz fully reopened.
Emergency reserves offer limited relief
Major economies’ planned release of up to 100 million barrels of emergency crude oil and diesel reserves could provide temporary relief but would not resolve the underlying imbalance between supply and demand, Nasser said.
Group of Seven leaders agreed on Friday to release about 100 million barrels from strategic reserves in an effort to lower fuel prices and ease market disruptions.
Oil prices remain well above pre-war levels despite a recovery in Gulf exports, with Brent crude trading around $100 a barrel over the past month.
Aramco increases alternative flows
Gulf producers have increased exports as they adapt to disruptions around Hormuz. Saudi Arabia, the United Arab Emirates and Kuwait have used their own tankers to move crude through the strait, while alternative pipeline routes have also taken on a greater role.
Aramco has restored flows through Saudi Arabia’s East-West pipeline to around 80% of capacity, allowing more crude to be shipped to the Red Sea and reducing reliance on Hormuz.
Nasser said Aramco had maintained supplies during the conflict by drawing on international storage and repairing damaged infrastructure. The company is also seeking additional export routes and overseas storage capacity to reduce its dependence on individual supply corridors.
On Aug. 4, Nasser said the world had lost more than 2.6 billion barrels of oil since the outbreak of the U.S.-Israeli-Iranian war, warning that inventories were declining despite efforts to reroute supplies.
N.J /M.F
