Aramco Issues Oil Reserve Warning
The CEO of Saudi Aramco, Amin Nasser, warned that global oil inventories are at "alarming" levels, increasing the vulnerability of energy markets to any new disruptions. He explained that the market's reliance on limited reserves exposes it to additional pressures, especially if the Strait of Hormuz is not fully reopened and confidence in oil supplies and trade is not restored. He pointed out that the plans of major countries to release around 100 million barrels from emergency reserves provide only temporary relief, but do not permanently address supply and demand imbalances or the need to build a robust strategic stockpile. It is expected to take about two years to rebuild inventories after the Strait of Hormuz is reopened. Meanwhile, Gulf countries have increased their production and exports to compensate for supply disruptions. Aramco has resumed about 80% of its East-West pipeline operations and is exploring options to enhance supply resilience through expanding storage facilities, given the strategic importance of the Strait of Hormuz as a vital passage for global oil trade and the potential impact of any restrictions on prices and costs.
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