Global oil reserves under pressure as Hormuz crisis raises fears of another supply shock

Global oil reserves are under pressure following the disruption at the Strait of Hormuz, raising concerns about the world’s ability to cope with another supply shock. The US Strategic Petroleum Reserve is at its lowest level since 1982, while China reportedly drew 47–57 million barrels from storage in September, according to the material citing McKinsey Global Institute.

At its peak, the Hormuz disruption took 14% of global oil and gas supply off the market. The scale of the shock has increased the importance of emergency stockpiles, alternative pipelines and flexible oil trade in keeping supplies moving.

Emergency oil stocks come under pressure

Strategic reserves help countries manage sudden supply disruptions while they find alternative sources. But releasing large volumes reduces the stock available for the next crisis.

In March, the International Energy Agency coordinated an emergency stock release, with the US pledging 172 million barrels, according to the supplied material. China’s reported drawdown of 47–57 million barrels in September adds to concerns over how quickly major economies can rebuild their reserves.

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The key challenge is not just managing the current disruption, but ensuring enough oil remains in storage if another supply crisis hits.

Alternative routes face risks

Pipelines and rerouted cargoes have helped cushion the impact of the Hormuz disruption. Saudi Arabia’s East-West pipeline carries crude towards the Red Sea, while the UAE has a pipeline to Fujairah that offers an alternative route for exports.

Refiners have also switched crude grades and suppliers to maintain operations. These measures helped the market absorb a disruption that affected a significant share of global energy supplies.

However, the supplied material says Saudi Arabia’s East-West pipeline was hit in September and October saw the highest number of ship attacks of the conflict. Damage to alternative infrastructure and continued threats to shipping could make it harder to maintain flows if the strait faces further disruption.

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Rebuilding reserves is the next test

The pressure on stockpiles highlights a key weakness in the global energy system: emergency reserves can cushion a crisis, but they are not unlimited. Replenishing them while protecting alternative routes will be important for countries seeking to reduce their exposure to future supply shocks.

For now, the question is whether major oil-consuming economies can rebuild their buffers before another disruption tests them. The Hormuz crisis has shown that alternative routes and emergency stocks can soften the impact of lost supplies, but their effectiveness depends on how much capacity remains when the next shock arrives.

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