How long could global oil stockpiles last if supply disruptions continue?

Global oil inventories are decreasing rapidly due to the U.S.-Iran conflict and the ongoing disruption to shipping through the Strait of Hormuz. Citi analysts estimate that global inventories decreased by about 3 million barrels per day between February and August 2026, resulting in a cumulative decline of roughly 519 million barrels.

If this trend continues, OECD stocks could reach around 70 days of supply by the end of 2027. Inventories outside China may fall to this threshold by mid-2028, while global stockpiles could reach it in the first quarter of 2029. A 70-day inventory level is notable as it was observed during the 1970s and 1980s oil shocks, when energy consumption reached around 8% of GDP.

At that time, energy costs were around $200 per barrel, compared to the current price of about $120. Citi warns that focusing solely on overall inventories might not capture the more immediate issues in various sectors of the energy market, such as refined products like diesel. Currently, diesel prices have risen significantly above WTI, with U.S. wholesale diesel prices exceeding $100 per barrel above WTI.

Refinery margins have surged by approximately 350% this year, reaching $33. Despite these supply concerns, Citi still expects an agreement to eventually be reached and the Strait of Hormuz to reopen in the fourth quarter of 2027, which would lead to a decline in Brent crude prices to the $60-per-barrel range by the end of 2027.