Web Desk | London, United Kingdom The global energy market is facing the largest oil supply disruption in history due to the ongoing conflict in the Middle East, according to the International Energy Agency.
In its latest monthly oil market report, the agency said oil production in Gulf countries has dropped by at least 10 million barrels per day (bpd) as a result of the conflict. The reduction represents nearly 10% of total global oil demand.
The crisis has intensified following the closure of the Strait of Hormuz, one of the world’s most critical energy shipping lanes.
To stabilize markets, the IEA announced a historic decision to release 400 million barrels of oil from global strategic reserves. According to the agency’s Executive Director, Fatih Birol, the move has already had a strong impact on global energy markets, which are currently experiencing an “extremely critical period.”
Birol stated during a press conference in Istanbul that the coordinated release was necessary to address severe supply disruptions triggered by the Middle East conflict.
The intervention marks the largest emergency oil release in history, surpassing the 182 million barrels released in 2022 after Russia launched its full-scale invasion of Ukraine.
Meanwhile, Donald Trump said the IEA’s decision would help substantially reduce oil prices during the ongoing conflict involving the United States, Israel, and Iran.
However, officials in Iran warned that oil prices could surge as high as $200 per barrel after attacks on tankers in Iraqi waters and vessels near the Strait of Hormuz.
Analysts say the continuing disruption in shipping routes and oil production could significantly impact global trade, fuel prices, and economic stability worldwide.
