Saudi Aramco's CEO Warns of Shrinking Oil Supply Buffer

The global oil market's supply buffer has significantly decreased after over 1 billion barrels were withdrawn from commercial inventories to mitigate disruptions caused by the ongoing crises in the Middle East and Ukraine. Amin Nasser, Chief Executive Officer of Saudi Aramco, disclosed this information at the Energy Intelligence Forum in London, emphasizing that much of the remaining oil in storage is not readily available to the global market.

The withdrawals have left the market increasingly vulnerable to further supply shocks, as governments and energy companies increasingly rely on stored oil to address shortages. The Group of Seven nations and their partners have agreed to release up to 100 million barrels of crude oil and diesel from emergency reserves, which is less than one day of global oil consumption.

Nasser noted the difficulty in reaching an agreement for this release due to the pressure on available inventories. The situation is compounded by the recovery of crude flows from the Middle East through the Strait of Hormuz to near pre-war levels, yet the market's capacity to absorb another major disruption remains limited.