IEA: Middle East Conflict Triggers Historic Oil Shock

This conflict caused the largest oil supply disruption in history, with 10.1 million barrels per day lost in March. Shipments through the Strait of Hormuz plummeted from over 20 million barrels per day in February to approximately 3.8 million barrels per day in early April, resulting in an overall loss exceeding 13 million barrels per day in oil exports.

Refineries in the Middle East and Asia cut runs by around 6 million barrels per day in April, and global crude runs are expected to decline by 1 million barrels per day on average across 2026. Global observed oil stocks fell by 85 million barrels in March as importers drew down inventories.

The IEA warns that "demand destruction will spread as scarcity and higher prices persist," with significant declines in naphtha, LPG, and jet fuel consumption in the Middle East and Asia-Pacific. While a two-week ceasefire offers some relief, the IEA's base case assumes a resumption of regular deliveries by mid-year, but acknowledges this could be optimistic, warning of "significant disruptions" if the conflict prolongs.