“You’re hitting tank bottom.” That is the phrase one oil industry executive used to describe the state of global petroleum inventories, in a conversation the executive said had already been shared with senior officials in Washington.
The same person gave it an unusually specific deadline: mid-to-late June, according to E&E News
The White House’s response was immediate and direct. “Politico’s anonymous sources are wrong,” a White House official said, while an Energy Department official added there have been no such discussions about inventory levels, according to E&E News. Four oil executives told Politico the opposite is true, and at least two of them have now made similar warnings on the record. Oil inventory data shows the steepest drawdown in decades The dispute traces back to the Strait of Hormuz, which Iran effectively closed following US and Israeli strikes that began on February 28.
The strait normally carries roughly one-fifth of the world’s oil supply. The inventory drawdown has been underway since the early weeks of the disruption, when the world was already burning through stockpiles at 7.1 million barrels per day. Worldwide petroleum stocks now hold around 7.5 billion barrels, a decline of approximately 500 million barrels since the conflict began, falling at a rate of roughly 5.8 million barrels per day, according to Jim Burkhard, vice president and global head of crude oil research at S&P Global Energy, cited by E&E News.