Saudi Aramco moves to mitigate oil shortfall, but tensions in the Strait of Hormuz pose severe risks to global supply
RIYADH: Saudi Aramco CEO Amin Nasser has issued a stark warning over ongoing disruptions in Middle Eastern oil supplies, emphasizing the strategic importance of the Strait of Hormuz and its potential impact on global markets.
Nasser revealed that about 180 million barrels of oil shipments have already been disrupted, with nearly 17% of global crude passing through the Strait. “Shipping resuming in the Strait of Hormuz is absolutely critical,” he stressed, cautioning that prolonged interruptions could have severe repercussions for both the oil market and the global economy.
Aramco is attempting to offset the shortfall by ramping up the East-West pipeline to full capacity in the coming days. However, Nasser noted this would restore only 7 million barrels per day, far below the 20 million barrels affected by the de facto closure of the Strait.
Highlighting the strain on global supply, Nasser said inventories are at a five-year low, which could accelerate drawdowns if tensions continue. “We are doing our best to meet the majority of our customers’ requirements under these circumstances,” he added, noting that spare production capacity remains concentrated in the Middle East.
Although oil prices have eased slightly, analysts warn of heightened market volatility and potential price spikes if the Strait disruption persists. “It is a clear enough warning, and it will only echo louder as the days go by if the situation continues,” Nasser concluded.
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