World has drained nearly 1 billion barrels from oil stocks since Iran war began, ADNOC chief warns at ADIPEC
Global oil inventories have fallen by nearly 1 billion barrels since the US-Israeli war on Iran disrupted shipping through the Strait of Hormuz, ADNOC chief Sultan Al Jaber said on Monday at the ADIPEC energy conference in Abu Dhabi, warning that the world has eroded its supply buffers.
The world has eroded its supply buffers by draining nearly 1 billion barrels from global oil inventories since the US-Israeli war on Iran disrupted shipping through the Strait of Hormuz, the chief executive of Abu Dhabi's state oil company, ADNOC, said on Monday. Sultan Ahmed Al Jaber made the warning in Abu Dhabi at the opening of ADIPEC, one of the world's largest energy conferences, as executives, ministers and investors gathered against a backdrop of repeated attacks on Gulf shipping and a war that has now run for months.
The headline figure is the scale of the draw. Before the war, the world held a cushion of commercial and strategic stocks that could absorb a shock; since February, when US-Israeli strikes on Iran began, that cushion has shrunk by close to a billion barrels, according to Al Jaber. The point he was making was not simply that stocks are lower, but that the margin for error has narrowed sharply: with less oil in storage, any fresh disruption — another tanker attack, a closure threat, a refinery outage — feeds into prices faster and with less room to wait it out.
The Strait of Hormuz sits at the centre of that story. The narrow waterway between Iran and Oman has carried roughly a fifth of the world's oil and a large share of its liquefied natural gas, and it has been the focus of the confrontation for months. Iran has imposed restrictions on vessels seeking to pass through it and has attacked ships it says violated those restrictions, while the United States has maintained a counter-blockade of Iranian ports. In recent days alone, tankers have been struck in the Gulf and near Hormuz, and a Pakistan-bound LNG carrier was hit near the strait — the kind of incidents that make shippers reroute, delay or demand higher insurance, even when cargoes eventually get through.
Diesel is where the strain is most acute. Al Jaber said diesel stockpiles in some areas had fallen to their lowest levels for this time of year in 35 years, and diesel prices in many markets have surged to record highs. Diesel matters far beyond the pump: it powers trucks, trains, farm machinery, generators and much of the freight system, so a diesel shortage quickly becomes a cost-of-living story, pushing up the price of moving food and goods. Alongside diesel, he pointed to a liquefied natural gas supply gap of 600 billion cubic feet in some markets, a reminder that the disruption is not confined to crude oil alone.
Shipping costs tell the same story in a different form. Al Jaber said the cost of shipping and logistics had risen to 30 per cent of the cost of a barrel of oil, up from about 5 per cent before the war began. When moving a barrel costs six times as much, in proportional terms, as it did before the fighting, the delivered price of energy rises even if the price at the wellhead does not move. Figures checked on Monday afternoon, 2 November 2026 (Pakistan time): the international benchmark Brent crude was trading at around $110 a barrel, roughly 50 per cent higher than its level in February just before the war began, after easing from last week's high near $118 as ceasefire and Hormuz-reopening talks continued.
Governments and international agencies have already tried to plug the gap. Last month the International Energy Agency agreed to release more than 20 million barrels of diesel into the market, alongside any oil remaining from a record emergency reserves release pledged in March, in an attempt to boost supply and cool soaring prices. Al Jaber's warning implicitly questions whether such releases are enough: 20 million barrels is a large intervention, but it is small beside a draw of nearly a billion barrels, and emergency stocks, once released, must themselves be rebuilt.
His counterpart in Saudi Arabia made a similar point last month. Amin Nasser, the chief executive of Saudi Aramco, said fewer than 6 billion barrels of commercial inventories remained worldwide, with the vast majority not practically available — stored in places, or in forms, that cannot quickly reach a market in need. Taken together, the two warnings from the Gulf's two largest producers describe a system that looks well supplied on paper but is thinner, in practice, than the headline inventory number suggests.
Al Jaber's prescription was structural rather than short-term. He called for expanded strategic storage, larger stockpiles of refined products rather than crude alone, and flexible refining capacity closer to consumer markets, so that a disruption in one region does not immediately become a shortage in another. The argument is that the energy system was built for a world in which Hormuz and other chokepoints could be assumed open, and that assumption can no longer be taken for granted. Rebuilding buffers, on this view, is not a luxury for calmer times but a condition for weathering the next shock.
What happens next depends on two tracks running in parallel: diplomacy and the market. On the diplomatic track, Qatari and Pakistani mediators have been shuttling between Washington and Tehran over a plan that could reopen Hormuz within two days of an agreement, and any breakthrough there would ease the shipping pressure that Al Jaber described — though it would not, by itself, refill a billion barrels of stocks. On the market track, traders will watch whether diesel stocks stabilise as winter demand rises, whether the IEA releases reach the markets that need them most, and whether Brent holds near $110 or climbs back towards last week's highs. If stocks keep falling while diplomacy stalls, the warning from Abu Dhabi will look less like a conference speech and more like an early signal of a harder winter for energy consumers. But if talks produce a reopening and shipping costs fall, the pressure could ease — slowly, since rebuilding inventories takes far longer than drawing them down.
This post is market news information only, not financial advice.
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