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Chevron CEO: US-Iran Conflict Hits Oil Markets Harder Than Russia-Ukraine War

Chevron CEO Mike Wirth states that the conflict between the US and Iran has caused greater damage to global oil and gas markets than the war in Ukraine. He highlights significant disruptions, with Asian nations running low on critical fuels like diesel and jet fuel. Wirth cautions that even if key shipping routes reopen, rebuilding inventories and supply chains will be a slow process. The ongoing turmoil has kept Brent crude prices high, raising concerns over global energy security and availability.

Key Points: Chevron CEO: US-Iran War Damages Oil Markets More

  • Middle East war disrupts oil & gas flow
  • Asia faces diesel, jet fuel shortages
  • Rebuilding supply chains will take significant time
  • Brent crude prices remain elevated above $100
3 min read

US-Iran conflict damaged oil markets globally more than Russia-Ukraine war: Chevron CEO

Chevron CEO Mike Wirth says the US-Iran conflict has disrupted global oil, gas, and fuel supplies more severely than the Russia-Ukraine war.

"We've got a lot of oil and gas now that is not flowing into the market. - Mike Wirth"

New Delhi, March 24

The ongoing conflict between the United States and Iran has caused more damage to global oil and gas markets than the prolonged Russia-Ukraine war, said Mike Wirth, highlighting the severity of disruptions in energy supply chains.

According to a report by Politico, Wirth cautioned that Iran's attacks on oil tankers and the broader escalation in the Middle East have significantly impacted global energy markets.

The report stated, "Wirth cautioned that Iran's attacks on oil tankers and the broader damage of the Middle East war did greater damage to oil and gas markets than the Russia-Ukraine war. Asian nations are running low on diesel and jet fuel. The war has held up deliveries of LNG, fertilizer and other products."

Wirth noted that assessing the extent of the damage remains a challenge, as it is still unclear how much production has been shut and how severely key facilities have been affected.

He added that rebuilding global petroleum supply chains will be a major task even after the situation improves. Speaking at the CERAWeek by S&P Global conference in Houston, Wirth said that the disruption has significantly impacted the flow of oil and gas into the market.

"We've got a lot of oil and gas now that is not flowing into the market," he said, adding that even if the Strait of Hormuz reopens, restoring supply chains will take time.

"Physical supply chains don't respond immediately, so even if the strait opens at some point, it will take time to rebuild inventories of the right grades of crude and the right types of fuel," Wirth said.

The disruption has affected not only crude oil but also key products such as LNG, diesel, jet fuel and fertilisers, raising concerns over energy availability, especially in Asian markets.

At the same event, US Energy Secretary Chris Wright said that while the disruption is expected to be short-term, companies should increase production to stabilise markets.

"Markets do what markets do," Wright said. "Prices went up to send signals to everyone that can produce more: 'Please, produce more.'"

The ongoing conflict has intensified concerns over global energy security, with supply bottlenecks and damaged infrastructure continuing to disrupt markets.

The Brent crude prices have touched as high as USD 113 per barrel in the international markets since the conflict began, the prices are still high and currently trading at USD 104 per barrel at the time of filing this report.

- ANI

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Reader Comments

R
Rohit P
Not surprising. The Strait of Hormuz is the world's most critical oil chokepoint. Any trouble there sends shockwaves globally, and Asia feels it most. Hope diplomacy prevails soon, for everyone's sake.
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Aman W
The mention of fertilizer is crucial. High energy costs mean expensive fertilizers, which means more expensive food. This hits the common man twice over. Policy focus should be on shielding agriculture from these global shocks.
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Sarah B
While the CEO's point about market damage is valid, it feels a bit simplistic to compare "damage" like this. The human cost of the Ukraine war is immense and of a different nature. Both conflicts are terrible for global stability.
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Karthik V
This is why our strategic petroleum reserves are so important. Hope they are being managed well to cushion such blows. Also, time to fast-track ethanol blending and electric vehicle infrastructure with real urgency.
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Michael C
"Markets do what markets do" – a classic line. But when prices spike, it's not just signals to producers, it's immense pressure on developing economies like India's. The call for more production makes sense, but the geopolitical fix is needed first.

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