Global oil stockpiles risk falling to critical or historically low levels if current drawdown rates continue into the summer peak demand period, the International Energy Agency (IEA) said at a June 2 conference in London [1, 2]. Toril Bosoni, head of the IEA oil industry and markets division, said, "We’re seeing stock draws continuing into the summer, and with the possibility or the likelihood that we reach critical levels or historical low levels just ahead of the peak summer demand."
Between March and April 2026, global crude inventories declined by about 250 million barrels amid rising consumption and supply disruptions [1]. In March, the IEA coordinated an emergency release of 400 million barrels to stabilize markets, but about half of that oil has yet to reach the market [2]. Bosoni added, "In any case, emergency stock releases are only a temporary stop-gap measure, they’re not going to solve this problem."
China’s crude oil inventories have begun to fall but remain relatively resilient compared to the global decline [1]. Meanwhile, the longer-term closure of the Strait of Hormuz due to ongoing Middle East hostilities is a major bottleneck in energy supplies. Reopening the strait could take six to eight months even if a peace deal is reached immediately [1, 2, 3].
The hostilities have escalated sharply since March when Hizbollah fired on Israel, followed by Iranian ballistic missile attacks on Kuwait and Bahrain on June 3, causing casualties [3]. The US responded with strikes on Iran's Qeshm Island the same day. Oil prices reflected growing tensions with Brent crude closing at $97.81 per barrel and WTI at $96.02, up about 2% [3]. Simon-Peter Massabni, head of business development at XS.com, said, "Crude prices continue to solidify their upward trajectory as accelerating clashes between the United States and Iran outpace stagnant diplomatic efforts."
Negotiations between Iran and the US have stalled, with Iranian Foreign Minister Abbas Araqchi stating, "Teheran’s contacts with Washington have not been cut off, but no progress has been made in the negotiations." Bob Yawger, director of energy futures at Mizuho, commented, "The chances of a ceasefire seem to be deteriorating. That’s the wrong direction we are moving in." [3]
The IEA said further coordinated emergency stock releases could be possible but are not currently being discussed and would only serve as temporary relief [2]. The energy market now faces mounting pressure ahead of the peak summer demand period, with a prolonged supply crunch expected given the ongoing strait closure and regional conflict.
The situation will be closely monitored as the potential reopening of the Strait of Hormuz remains at least six months away following any peace agreement, leaving oil supplies constrained into the latter half of 2026 [1, 2, 3].
