Global Oil Inventories Fell by 200 Million Barrels in April Due to Middle East Conflict

Global crude oil inventories decreased by a record 200 million barrels in April. This reduction is attributed to the conflict in the Middle East, threatening a sharp increase in oil prices ahead of the summer travel season. This information comes from the Financial Times, citing data from S&P Global Energy and Goldman Sachs analysts.

According to S&P Global Energy estimates, oil volumes in storage declined by 6.6 million barrels per day. This occurred despite a drop in demand of approximately 5 million barrels per day, the sharpest consumption decrease since the COVID-19 pandemic. Overall, due to the war waged by the US and Israel against Iran, the oil market has already lost about 1 billion barrels of crude. Traders warn that global inventories are approaching a critical threshold, and a «tipping point» could be reached within weeks.

Jim Burkhard, head of oil research at S&P, stated: «The inevitable market reckoning is coming, higher oil prices are still ahead.» Traders predict that prices could surge even higher if global inventories fall below critical levels. According to Goldman Sachs, global oil inventories are currently nearing their lowest level in eight years. In Northern Europe, jet fuel stocks in April dropped to a six-year low, while in the US, gasoline inventories could reach historically low levels during the peak summer season.

Although total global oil inventories stand at approximately 4 billion barrels, a significant portion of this volume is tied up in daily operations necessary to keep refineries running and maintain pipeline pressure, limiting the amount that can be quickly utilized. According to Burkhard, a sharp drop in US inventories could signal broader alarm, as the worst phase of the crisis is yet to come.