Source: Fortune
Summary
Exxon and Chevron executives warned that the world is running low on oil reserves, which could lead to a price spike. The Strait of Hormuz remains contested, and the US has been releasing oil from its Strategic Petroleum Reserve to keep prices in check. However, inventories are dwindling, and experts predict that commercial oil inventories could reach critically low levels by early June. Exxon’s Neil Chapman said that once inventory levels hit rock bottom, prices will surge. Chevron’s Mike Wirth expects oil prices to jump as the market’s “shock absorbers” are depleted.
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Exxon and Chevron are sounding the alarm on low oil reserves, with Exxon’s Neil Chapman warning of “unheard of inventory levels” that could lead to a price spike. The US has released 50 million barrels from its Strategic Petroleum Reserve, but inventories are still dwindling. Chevron’s Mike Wirth expects oil prices to jump as the market’s “shock absorbers” are depleted. The situation is dire, with key regional oil hubs like Cushing, Okla. nearing operational lows. The US is guiding more ships to safety, but Iran has kept up attacks on commercial ships. One thing is certain: the oil market is headed for a shock.
Exxon and Chevron are preparing for a price spike, but they’re also warning of a “new normal” of higher energy prices and a constant threat environment.
Author: Evan Null
