US-Iran war triggers 'largest oil supply disruption in history': Report
The disruption far exceeds previous crises. During the Suez Crisis, about 10% of global oil supply was affected, while the Arab oil embargo disrupted around 7%.
The ongoing conflict between the United States and Iran has caused the largest oil supply disruption in history, according to an analysis by energy consultancy Rapidan Energy.
Roughly 20% of global oil supply has been disrupted for the past nine days as tanker traffic through the Strait of Hormuz remains at a standstill. The crisis has pushed crude oil prices above $100 per barrel, reports CNBC.
The disruption far exceeds previous crises. During the Suez Crisis, about 10% of global oil supply was affected, while the Arab oil embargo disrupted around 7%.
Analysts say the current situation is more severe because there is no spare production capacity available to stabilise the বাজার. Major producers like Saudi Arabia and the United Arab Emirates, which usually hold reserve capacity, are effectively cut off due to the closure of Hormuz.
"The conflict has not only taken offline a historically high share of global supply – it has simultaneously disrupted the primary holders of spare capacity," Rapidan analysts said, warning that the market now has "no meaningful cushion."
With limited supply alternatives, the market may be forced to rebalance through reduced demand driven by sharply rising prices, the report added.
The US Strategic Petroleum Reserve currently holds about 415 million barrels, around 58% of its total capacity, but analysts say it is "finite and insufficient" to fully offset the supply shock.
A White House official said the administration of Donald Trump believes oil markets remain adequately supplied and that additional measures would be taken if necessary.
Meanwhile, pressure is mounting on members of the International Energy Agency to release strategic reserves, seen as the only remaining short-term option to ease supply constraints.
Finance ministers from the Group of Seven met on Monday to discuss a coordinated release, though no decision has yet been made, according to officials.
