Washington DC, March 16
Oil industry leaders have warned US President Donald Trump and his administration that the ongoing disruption of the Strait of Hormuz is likely to worsen the global fuel crisis, according to a report by The Wall Street Journal.
The report stated that American oil executives cautioned officials that the energy crisis triggered by the Iran war could intensify as disruptions in the vital waterway continue to affect global energy flows.
According to WSJ, in a series of White House meetings held on Wednesday and recent conversations with Energy Secretary Chris Wright and Interior Secretary Doug Burgum, the chief executives of Exxon Mobil, Chevron, and ConocoPhillips expressed concerns over continued volatility in global energy markets.
WSJ report noted that, Exxon CEO Darren Woods told officials that oil prices could rise beyond current elevated levels if speculators unexpectedly bid up prices.
He also warned that markets could face a supply crunch of refined products. Chevron CEO Mike Wirth and ConocoPhillips CEO Ryan Lance also conveyed concerns about the scale of the disruption.
Industry executives also noted that domestic production increases in the US are likely to remain modest and will not be able to replace the roughly 9 million to 10 million barrels of oil per day that analysts say are currently trapped behind the Strait of Hormuz.
President Trump did not attend the Wednesday meetings. However, US oil prices have already climbed from USD 87 a barrel that day to USD99 a barrel by Friday.
Earlier, US President Donald Trump announced that he has requested approximately seven nations to deploy warships to assist in maintaining transit routes through the Strait of Hormuz as the conflict with Iran continues to impact the critical maritime corridor.
The President's remarks on Sunday (US local time) follow reports indicating his intention to establish an international coalition to provide escorts for vessels navigating the strait. The waterway is a vital artery for global energy, with nearly 20 per cent of the world's oil exports passing through it.
While Trump did not specify the invited countries, he highlighted that the selected nations are those with a high level of dependency on Middle Eastern oil supplies.
Speaking to journalists on Air Force One, he said, "We're talking to countries about policing the straits because they are the ones -- you know, we don't get oil, very little, 1%. China, as an example, gets about 90% of its oil from the Hormuz Strait. It'd be nice to have other countries policing with us. And we'll help, and we'll work with them."
The President took a firm stance on the responsibility of international partners, stating, "I'm demanding that these countries come in and protect their own territory because it is their own territory."Despite escalating global oil prices, no country has yet provided a definitive commitment to the mission.
More than 20 million barrels of crude oil pass daily through the narrow channel separating the Iranian coast from Oman. That volume represents roughly a fifth of global oil consumption and nearly a quarter of all seaborne oil trade. A significant share of the world's liquefied natural gas also moves through the same passage. When that flow falters even briefly, the consequences cascade across financial markets, supply chains and household budgets around the world.
- ANI
Reader Comments
We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.