At the Energy Intelligence Forum in London on Tuesday, Russell Hardy put it bluntly: "There aren't any more inventories to drain in the West," adding, "We drained the available inventory." He linked the drawdown to the Iran war and cautioned that the squeeze has not yet eased.
On Friday, the Group of Seven nations and allied countries said they would pull 100 million barrels from emergency stockpiles after pressure from the Trump administration for Europe to help tamp down spiking diesel prices. Hardy said the specifics of that draw are "not fully transparent."
Spare capacity is the buffer that keeps an oil shock from becoming a crisis. Market Briefs covers the energy market free every weekday.
Hardy expects the crunch to linger: "Products are still in a very, very tight situation and that will probably roll forward for a little bit longer as we go through winter," he said. One day before his remarks, Saudi Aramco's chief executive warned that, because of logistical snags, fewer than 10% of the global 6 billion-barrel inventory is readily usable. Put simply, getting barrels to where they are needed is the challenge.
The takeaway for households: Western stockpiles are tapped out, an emergency 100 million barrels is coming, and only a sliver of global inventories is easy to access. If you follow energy costs, those are the pressure points to watch as winter approaches.
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