The world has nearly burned through its oil stockpile buffer, executives say: System is already straining

LONDON, Oct 6 – The amount of oil in storage that is accessible to the global market is running low, industry executives said at a forum in London this week, making the market more fragile and putting upward pressure on prices.Governments and energy companies have drawn oil from stockpiles to alleviate pressure in a global oil market facing unprecedented supply disruptions this year due to the wars in the Middle East and Ukraine.“Less than six billion barrels of commercial inventories remain today, with the vast majority not practically available, so the system is already straining,” Amin Nasser, CEO of Saudi Arabia’s state oil company Saudi Aramco, said at the Energy Intelligence Forum in London.More than one billion barrels of oil have been released mainly from onshore commercial inventories since the start of this year’s Middle East crisis, which was the last major tool in the box, Nasser said.The International Energy Agency, the West’s oil watchdog and coordinator of its strategic oil reserves, is preparing to release 100 million barrels of crude and diesel to help alleviate soaring diesel prices, but it is not clear if some of that total will include volumes from its record first 400 million barrel release in March that hadn’t hit the market yet.“It took a lot of negotiations, but it is 100 million,” Nasser said of the IEA decision.“Inventories are reaching a stress level.

Only 10% or less is available, that’s why they struggle with 100 million barrels.”World oil demand is about 102 million barrels per day, according to the IEA.The loss of the oil market’s buffers has made the market more fragile, Chevron CEO Mike Wirth said on Tuesday, adding that this has increased oil’s price floor.Oil market turmoil will continue beyond next year, executives said at the conference on Monday, as it could take years to refill inventories on top of meeting global demand.Not all oil in storage is immediately usable because of operational factors lik...