Brent crude rises to $110.85 as emergency oil stocks shrink
Brent crude, one of the main international oil benchmarks, rose by more than $2 to $110.85 a barrel on Wednesday, close to a five-month peak, according to Al Jazeera. The rise is the latest sign of the strain on global oil supplies since the US-Israel war on Iran began on February 28.
The disruption centres on the Strait of Hormuz, the sea passage through which most oil produced in the Persian Gulf is exported. At the time of the International Energy Agency's March report, export flows through the strait were at a near standstill. Oil is still getting through, but flows are not regarded as completely secure or guaranteed.
Governments have responded partly through emergency stocks, which are government-held reserves of crude oil kept for supply shocks. The IEA, an energy body of importing countries set up in 1974 after the Arab oil embargo, requires its members to hold at least 90 days of net imports. China and India are not IEA members. On March 11, the IEA's 32 members agreed to make 400 million barrels available from these reserves. The United States pledged 172.2 million barrels from its Strategic Petroleum Reserve, and Japan pledged 79.8 million, according to IEA figures. Fortune described the release as a record.
The drawdown is now visible in the figures. The US Strategic Petroleum Reserve has fallen to 283 million barrels, its lowest level since October 1982. Global strategic stocks outside China and Iran have fallen by nearly 327 million barrels since the end of December 2025. China's onshore crude stocks stand at 1.13 billion barrels, down from 1.23 billion in late February. IEA member governments still hold publicly owned emergency stocks equivalent to around 1.1 billion barrels, according to Reuters.
Shipping in the region remains under attack. Reuters reported that Iran is deploying new tactics to target vessels sailing through the Strait of Hormuz, and that Iran was also targeting tankers well beyond the strait. Reuters also reported that Iran and the allies it arms attacked key oil-routing systems at Fujairah, the main port outside the strait, disabling operations there. A Reuters report said a US blockade kept Iranian crude exports at zero in October.
Demand is moving in the other direction. The IEA forecasts world oil demand will fall by 2.5 million barrels per day in the fourth quarter of 2026 compared with a year earlier, and by 2.6 million barrels per day on average across 2026. Reuters reported that refining margins reached record highs for some refiners during the war and the closure of the strait.
An estimate published by Oil & Gas Journal put the potential impact of a closure lasting a few weeks at crude prices above $150 a barrel.
