Saudi Aramco CEO Nasser says the market could lose around 100mln barrels of oil each week the Strait of Hormuz remains closed if current disruptions persist

CEO Nasser says:

• Strong refining margins show physical market tightness, highlighting an apparent disconnect with futures markets.
• Demand rationing is expected to continue as long as Strait of Hormuz supply disruptions persist.
• A resumption of normal trade and shipping would likely drive a very robust return to demand growth.
• Strait of Hormuz traffic has fallen from about 70 vessels a day to just two to five.
• Forecasts point to oil demand growth of around 700k to 900k bpd in 2026.
• Supply-security urgency will drive rapid restocking and rebuilding of strategic reserves and commercial inventories.
• Even in the most optimistic scenario, energy and quantity supply chains will need several months to return to the pre-conflict traffic as vessels reroute or avoid being idle.
• Industry needs to address declining reserves, will need to divert cash to attain this.
• They are looking to maximise efforts from refineries in the west of the country.
• This is a completely different crisis, with the length of the crisis in terms of interruption, combined with the number of attacks on facilities; currently working to increase resilience.
• Did start seeing a problem in April as vessels were already en route in March, and they started seeing it much more in May and June as inventories are drawn down
• The longer it go on for, it will take all producers to bring some production facilities back online as they do face technical problems after being shut for so long.
• Are maximising products at this stage because of higher margins. Depends on the situation, but that might be the case until the Strait of Hormuz is reopened.