Middle East oil flows of around 14 million barrels a day help ease price pressure: Vitol CEO

Vitol CEO Russell Hardy stated that around 14 million barrels of oil flowing daily from the Middle East help ease price pressure on energy markets. This flow, consisting of 12 million barrels of crude oil and 2 million barrels of refined products, has been crucial in maintaining energy balance as inventories in the West have significantly decreased.

Hardy emphasized that without this flow, the US$200 per barrel scenario could occur, underscoring the importance of the ongoing oil flow. The global oil market had demonstrated resilience despite a series of disruptions, from a crude oil crisis to a products crisis and now a shipping crisis. China had been a vital support during the early months of the year, but developing nations in Asia lacked the necessary buffer due to closely linked supply chains with the Middle East.

Hardy also noted that refined products markets still face tightness into the winter, as the world remains short of refining capacity due to disruptions in Russian infrastructure and reduced refining operations in the Middle East. The G7 recently agreed on a coordinated release of 100 million barrels of crude and diesel from strategic reserves to alleviate tightness, particularly benefiting Europe.

Brent crude futures currently trade at approximately US$98 per barrel, while European benchmark diesel futures are around US$70 per barrel above crude.