'Oil inventories at five-year low': Aramco CEO warns of 'catastrophic' consequences if Hormuz closure goes on
"Spare oil output capacity is mostly concentrated in this region, so shipping resuming in the Strait of Hormuz is absolutely critical," says Aramco CEO
- Mar 10, 2026,
- Updated Mar 10, 2026 12:51 PM IST
Saudi Aramco's Chief Executive Officer, Amin Nasser, has warned that the prolonged disruption to global oil supplies caused by the ongoing US-Israel-Iran conflict could have "catastrophic consequences" for the world's oil markets, Reuters reported on Tuesday.
Also read: Govt invokes ECA to ensure LPG supply, orders refineries to divert key streams
Nasser said that while the company is doing its best to meet customer demand, the conflict and its resulting logistical bottlenecks have already sent global inventories to their lowest levels in five years.
"With the current geopolitical crisis, global inventories are already at a five-year low," he said.
"If this disruption goes on longer, we will see faster drawdowns," Nasser said. "There would be catastrophic consequences for the world's oil market, and even more drastic consequences for the global economy."
Also read: West Asia war brings India’s LPG caverns into focus amidst shortage
The CEO highlighted the critical importance of the Strait of Hormuz, through which a significant portion of global oil and natural gas flows. "Spare oil output capacity is mostly concentrated in this region, so shipping resuming in the Strait of Hormuz is absolutely critical," Nasser stated, underscoring the strategic importance of restoring safe transit through the vital waterway.
Following joint strikes by Israel and the US, Iran has shut the Strait of Hormuz, disrupting energy flows and exacerbating concerns over supply shortages.
Saudi Arabia, the world's largest oil exporter, has already begun cutting output at two of its key oilfields, although the extent of the reduction and which fields have been affected remains unclear.
Aramco has been rerouting some of its crude cargoes to the Red Sea port of Yanbu, but analysts have said these volumes are insufficient to offset the millions of barrels of oil that would typically flow through the Strait.
The war, which began on February 28 after joint US-Israeli strikes on Iran, has disrupted oil production across the Gulf. Neighboring countries, including Kuwait, Qatar, and Iraq, have also cut production or declared force majeure on shipments.
Iran's missile and drone attacks have halted much of the oil and gas production from countries bordering the Strait of Hormuz, which typically handles about 20% of the world's oil and liquefied natural gas (LNG) shipments.
In particular, Qatar Energy halted LNG production at its Ras Laffan export hub, while Iraq's oil output has dropped by 70%. Bahrain's state oil company, Bapco, also declared force majeure on its oil shipments.
The situation has driven oil prices to their highest levels since mid-2022, with Brent crude futures spiking to nearly $120 a barrel earlier this week.
Although prices have since moderated, the threat of ongoing conflict in the region has put strain on global energy markets and raised the possibility of prolonged high fuel prices for consumers and businesses.
Saudi Aramco's Chief Executive Officer, Amin Nasser, has warned that the prolonged disruption to global oil supplies caused by the ongoing US-Israel-Iran conflict could have "catastrophic consequences" for the world's oil markets, Reuters reported on Tuesday.
Also read: Govt invokes ECA to ensure LPG supply, orders refineries to divert key streams
Nasser said that while the company is doing its best to meet customer demand, the conflict and its resulting logistical bottlenecks have already sent global inventories to their lowest levels in five years.
"With the current geopolitical crisis, global inventories are already at a five-year low," he said.
"If this disruption goes on longer, we will see faster drawdowns," Nasser said. "There would be catastrophic consequences for the world's oil market, and even more drastic consequences for the global economy."
Also read: West Asia war brings India’s LPG caverns into focus amidst shortage
The CEO highlighted the critical importance of the Strait of Hormuz, through which a significant portion of global oil and natural gas flows. "Spare oil output capacity is mostly concentrated in this region, so shipping resuming in the Strait of Hormuz is absolutely critical," Nasser stated, underscoring the strategic importance of restoring safe transit through the vital waterway.
Following joint strikes by Israel and the US, Iran has shut the Strait of Hormuz, disrupting energy flows and exacerbating concerns over supply shortages.
Saudi Arabia, the world's largest oil exporter, has already begun cutting output at two of its key oilfields, although the extent of the reduction and which fields have been affected remains unclear.
Aramco has been rerouting some of its crude cargoes to the Red Sea port of Yanbu, but analysts have said these volumes are insufficient to offset the millions of barrels of oil that would typically flow through the Strait.
The war, which began on February 28 after joint US-Israeli strikes on Iran, has disrupted oil production across the Gulf. Neighboring countries, including Kuwait, Qatar, and Iraq, have also cut production or declared force majeure on shipments.
Iran's missile and drone attacks have halted much of the oil and gas production from countries bordering the Strait of Hormuz, which typically handles about 20% of the world's oil and liquefied natural gas (LNG) shipments.
In particular, Qatar Energy halted LNG production at its Ras Laffan export hub, while Iraq's oil output has dropped by 70%. Bahrain's state oil company, Bapco, also declared force majeure on its oil shipments.
The situation has driven oil prices to their highest levels since mid-2022, with Brent crude futures spiking to nearly $120 a barrel earlier this week.
Although prices have since moderated, the threat of ongoing conflict in the region has put strain on global energy markets and raised the possibility of prolonged high fuel prices for consumers and businesses.