Major Threat of Global Oil Supply Crisis as Crude Prices Surge Amid Pipeline Closures and Postponed Regional Talks
LONDON : Widespread turmoil across the international markets has been observed in the wake of surging oil prices around the world, fast-track diesel prices have surpassed Rs400 in Pakistan and petrol price continue to race forward on an aggressive note.In global commodity markets oil prices rose by more than 2½ percent. British Brent crude settled at $107 per barrel while US West Texas Intermediate (WTI) closed at $102 per barrel.
A high-level meeting of the Gulf countries over new maritime arrangements in the Strait of Hormuz was postponed. After a request from some regional states, both Oman and Iran confirmed that the consultative session was postponed on their mutual agreement.
As for the enforcement actions that are currently in place in the waterway, international actors have mentioned that shipping adjustments and regional transit policies are still responsible for market volatility.Major Supply Risk Looming Over Region As Oil Market Analysts Warn of a Major Supply Crisis.
Saudi Arabia’s key East-West oil pipeline has been shut down in an ongoing move that could impact supply of as much as 4 percent of global oil supplies. If Saudi Arabia does not restore operations of its Red Sea oil pipeline in the next few days, then the Kingdom’s export stocks could be completely drained, the international news agency Reuters said.
Currently, the Saudi Red Sea port of Yanbu has only 5-7 days’ supply of oil stored. Saudi Arabia uses the 1,200-kilometer pipeline to transport some 4 million barrels of crude oil a day to the Yanbu export terminal.