The Strait of Hormuz has been reopened after the agreement between America and Iran this week. However, experts say that it may take a long time for the world to come out of the oil crisis. Oil supply from the Middle East was affected for about four months. According to analytics company Kpler, during this period the world had to face a total shortage of 1.15 billion barrels of oil. This has put huge pressure on the global oil market.
According to the International Energy Agency (IEA), the world’s strategic oil reserves have reached their lowest level since 1990. America’s emergency oil reserves are also at the lowest level in 43 years. Commercial oil reserves of many countries have also decreased rapidly. During the G7 conference, US President Donald Trump said that if the Strait of Hormuz was not opened, the world’s oil reserves could have reached a serious crisis in about four weeks.
Fear of increase in oil prices
During the war, the price of Brent crude oil reached $ 126.41 per barrel. But after the US-Iran agreement, prices have fallen below $80 per barrel. Despite this, many experts believe that oil prices may rise again.
In the last few months, about 19 crore barrels of oil has been reduced from the world’s oil reserves. Many big storage centers of the world, including the Cushing Oil Hub in Oklahoma, America, are under pressure. The oil level there has reached so low that it is becoming difficult to maintain the supply.
Why won’t the crisis end immediately?
Hormuz has opened, but oil will not reach the market immediately. First the sea routes will have to be made safe, tankers will have to be brought back, oil production will have to be increased and then the oil will have to be transported to different countries of the world. This entire process may take several months.
Some experts believe that the market is currently too optimistic and is ignoring the real shortage of oil. Other experts say that OPEC countries are preparing to increase production, due to which the supply may improve in the coming time.
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