Oil markets on edge
Kuwait has cut oil output as Middle East tensions rise reported, and Qatar warned that any disruption to the Strait of Hormuz could trigger a global shock to supply warned. Iraq says it will maintain production to balance economic needs with OPEC+ commitments, but the regional fragility is keeping oil markets and risk premia elevated reported.
The International Energy Agency reported that Gulf producers have already cut at least 10 million barrels per day of output as of its March 12 Oil Market Report. iea.blob.core.windows.net Before the crisis, roughly 20 million barrels per day transited the Strait of Hormuz; the IEA says those flows have plunged away from that level. iea.org The U.S. Energy Information Administration estimates that the Strait handled about 21% of global petroleum liquids consumption in recent years, underscoring why the stoppage has an outsized global effect. eia.gov Brent crude breached the $100-per-barrel mark in early March as tanker attacks and export delays accelerated; market reporting showed the benchmark jumping above $100 on March 12. worldoil.com The IEA and member governments agreed to coordinate a release of nearly 400 million barrels from emergency reserves in response to the supply shock, a volume the IEA noted is roughly double the emergency release after Russia’s 2022 invasion of Ukraine. aljazeera.com Marine war-risk underwriters have pulled coverage for Gulf transits and brokers reported war-risk premiums spiking (Lloyd’s indicators rose from about 0.05% to 0.75% of cargo value in early March), constraining tanker availability. spglobal.com Kuwait’s state oil company declared force majeure on March 7 and began reducing refinery and field throughput while not publicly disclosing exact b/d cuts, according to trade notices and Reuters reporting. tbsnews.net Iraq’s oil minister has said Baghdad will hold crude output near about 1.4 million barrels per day and shift some volumes — roughly 200,000 b/d — onto truck and overland routes through Türkiye, Syria and Jordan. sahmcapital.com
