Global oil inventories are "reaching a stress level," Saudi Aramco CEO Amin Nasser said.
According to the International Energy Agency, global oil inventories stood at about 7.8 billion barrels in August, about a half-billion barrels less than prewar. But the vast majority of that oil is in pipelines, needed for operations or otherwise tied up, Nasser said-only 10% of global oil stocks can actually be tapped.
"That's why you find they are [struggling] with 100 million barrels," Nasser said, referring to the agreement struck by Group of Seven economies on Friday to release crude oil and fuel products from their strategic reserves.
He predicted that a stockpiling wave will boost oil demand for years once the Iran war is resolved: Just replenishing strategic stockpiles to prewar levels would add 2 million barrels a day to global demand for 18 months if the conflict were to end now, according to Nasser.
Speaking on stage at the Energy Intelligence Forum in London, Nasser also said:
-- Aramco is studying two new routes for getting oil to market, in addition to the three it already has (via the Hormuz Strait, or either north or south via Saudi Arabia's Red Sea coast). The company started considering new routes "on day one" of the war, Nasser said.
-- He didn't comment on Aramco's export volumes, but said it's meeting customer requirements.