The world has lost about 1 billion barrels of oil over the past two months, and energy markets will need time to stabilise even if disrupted flows resume, the chief executive of Saudi Aramco said on Sunday, as shipping through the Strait of Hormuz remains severely constrained.
“Our objective is simple: keep energy flowing, even when the system is under strain,” Amin Nasser said in a statement to Reuters after Aramco reported a 25 per cent jump in first-quarter net profit.
Global supplies have been sharply squeezed by Iran’s blockade of the Strait of Hormuz, which has curtailed tanker traffic and pushed oil prices higher in the wake of the US-Israeli war. Nasser said that even if shipping routes reopen, markets will not quickly return to balance.
“Reopening routes is not the same as normalising a market that has been deprived of about one billion barrels of oil,” he said, adding that years of underinvestment have compounded pressure on already low global inventories.
Aramco has increased use of its East-West Pipeline, which allows crude to bypass Hormuz and reach export terminals on the Red Sea, an asset Nasser described as a “critical lifeline” to help mitigate the global supply crunch.
Despite changes in shipping patterns, Nasser said Asia remained a core focus for the company and central to global oil demand, underscoring Aramco’s commitment to supplying the region even as geopolitical risks continue to roil energy markets. |
