Almost half of global oil flows from war zones

In 2026, nearly half of the world's oil supply originates from countries grappling with conflict, according to Reuters calculations based on International Energy Agency data. This revelation highlights the unprecedented scale of current disruptions, surpassing previous energy crises. The turmoil began six months ago when U.S. and Israeli attacks on Iran ignited the largest oil supply crisis on record, with no resolution in sight.

Simultaneously, the Russia-Ukraine war has led to production and refining cuts, including in Kazakhstan this year. Ongoing conflict in Libya and U.S. restrictions on Venezuelan oil exports at the start of the year have further strained global oil markets. Together, countries affected by these conflicts produced approximately 45 million barrels of oil per day in 2025, accounting for more than 43% of global supply.

The disruptions have compelled nations to rely more heavily on U.S. oil supplies, though U.S. oil production has not been immune to weather-related disruptions. While the current Gulf oil disruption is estimated at 5 to 7 million barrels per day, risks to total global flows remain elevated due to attacks in the Red Sea and near Egypt's Suez Canal.

These conflicts have also reduced global refining capacity by about a tenth, with Ukraine targeting much of Russia's refining network. Russia is facing fuel shortages and has prohibited gasoline and diesel exports, exacerbating global fuel market tensions. The surge in fuel prices has contributed to higher inflation, resulting in record U.S. debt and driving up diesel prices to record highs, even as refiners operate at peak capacity.

The International Energy Agency has released record volumes from emergency stockpiles to alleviate the supply shock, but these measures are now largely exhausted, despite global inventories persisting in decline.