Global Oil Draws Hit 8.7 Million Bpd as Asia Nears Minimum Levels and Europe Faces July Shortages
Updated
Updated · OilPrice.com · May 28
Global Oil Draws Hit 8.7 Million Bpd as Asia Nears Minimum Levels and Europe Faces July Shortages
6 articles · Updated · OilPrice.com · May 28
Asia is already at the brink of minimum operational oil-stock levels, Jeff Currie said, with Europe about a month behind and U.S. shortages likely to emerge in July.
Global inventories have been drawing at 8.7 million barrels a day since early May—the fastest pace on record—as Middle Eastern exports through the Strait of Hormuz run at about 5% of normal and summer demand rises.
Europe has been cushioned by U.S. barrels, including flows linked to the Strategic Petroleum Reserve, but Currie said that support cannot last, making a European crunch increasingly likely.
Goldman Sachs had earlier said minimum levels were unlikely this summer, though it also flagged the fastest April depletion in years; the IEA has separately warned the market could enter a "red zone" in July or August.
Brent slipped back below $100 after topping that mark on fresh U.S. strikes on Iran, but analysts say the deeper risk is a prolonged supply squeeze that could keep oil and gasoline prices elevated for years.
Why is the 'paper' oil market ignoring warnings of a real-world supply crisis?
How will the Hormuz crisis disrupt global food and tech supplies beyond just oil and gas?
With Iran controlling the Strait like a tollbooth, is this the new normal for global energy security?
2026 Oil Shock: Historic Inventory Collapse, Strait of Hormuz Blockade, and the Surge Toward $200 Crude
Overview
Global oil markets are facing a severe crisis as inventories reach historic lows, driven by rapid depletion and escalating geopolitical tensions. The blockade of the Strait of Hormuz by Iran has created a massive supply gap, with storage facilities in key consuming regions being emptied faster than they can be refilled. Even if the Strait reopens soon, experts warn it will take months for shipping and production to recover. This inventory crunch, combined with ongoing instability, has triggered a sharp surge in oil prices and raised serious concerns about future supply disruptions and the sustainability of current inventory levels.