William Tilles

Escalating U.S.-Iran tensions and the failure to extend a June ceasefire have pushed Brent crude above $91 per barrel and West Texas Intermediate above $85. Iran has indicated it may adopt a more offensive strategy and could act against shipping through the Strait of Hormuz, while President Donald Trump has issued further threats involving Oman. U.S. diesel crack spreads exceeded $100 per barrel for the first time, reflecting a worsening supply crunch. Global refinery output is down by about 5 million barrels per day year over year, with diesel production especially affected by refiners’ earlier focus on gasoline and jet fuel. Ukrainian drone attacks on Russian refineries and Russia’s resulting ban on diesel exports through year-end have added to the pressure.

Water scarcity is emerging as a major energy-security risk because hydropower depends on reservoir levels, thermal plants need water for cooling, waterways transport fuel, and electricity grids and AI data centers face additional stresses during extreme heat. The authors argue that market pricing alone cannot efficiently or fairly allocate water, since supplies are constrained, demand is largely inelastic, water has no easy substitute, and fragmented legal and institutional systems complicate reform. They criticize the Trump administration for favoring water-intensive nuclear and coal generation while weakening climate and water-quality efforts, and urge energy-sector planners to stop relying on historical water averages. Water’s fixed or declining supply amid rising industrial and energy demand could make it a defining commodity and source of future political conflict.

Russia has received its first gasoline shipment from India as Ukrainian attacks and refinery outages intensify fuel shortages across at least 10 Russian regions, including the Moscow region. The approximately 68,000-metric-ton cargo, produced by Nayara Energy at its Vadinar refinery, arrived at the Arctic port of Vitino after a ship-to-ship transfer in Egypt, with two additional Indian shipments expected. Russia is also importing fuel from Belarus and other Asian suppliers while gasoline sales decline and domestic petroleum-product exports fall sharply. The shutdown of the 120,000-barrel-per-day Orsk refinery after an August 11 attack has further tightened supplies, while it remains unclear whether Russian crude was used to produce the Indian cargo.

Chevron announced an offshore Angola oil and gas condensate discovery in the 105-4X well in Block 0, which encountered more than 300 feet of net pay in the Pinda reservoir. The company has not disclosed recoverable-resource or production estimates but is assessing whether the discovery can be tied into existing facilities, potentially lowering development costs and shortening the path to production. The find follows recent exploration and appraisal successes in Angola and could support the country's efforts to revive oil output, while reinforcing Chevron's broader return to exploration in Africa.

Libya’s electricity grid suffered another major collapse, taking the Zawiya, Khoms and Ubari power plants offline and cutting power across western, central and southern regions. The outages also halted pumping stations in the Great Man-Made River system, threatening water supplies. Weeks of blackouts, attacks on energy infrastructure and protests have increased pressure on Prime Minister Abdul Hamid Dbeibah’s Government of National Unity and the fragile division between western and eastern power centers. Disruptions at the Mellitah complex and damage around Zawiya have also threatened oil and gas operations, even as Libya produces about 1.4 million barrels per day and seeks to raise output to 2 million barrels per day in the early 2030s.

China curtailed up to 360 terawatt-hours of solar and wind generation in the first half of 2026, a 49% increase from a year earlier, according to research by the Centre for Research on Energy and Clean Air and Global Energy Monitor. Grid constraints and the rapid expansion of coal-fired power capacity have increased electricity oversupply, wasting clean generation that could have covered all of China’s growth in electricity demand during the period and enabled lower coal output. Wood Mackenzie warned that rising curtailment and volatile power prices could undermine renewable developers’ income stability and make some provinces less attractive for investment under China’s new renewable-power pricing mechanism.

A proposed pipeline carrying Iraqi crude from Kirkuk through Iraq and Syria to the Mediterranean port of Baniyas is unlikely to bypass the Strait of Hormuz within two years. Sources familiar with the project estimate that new infrastructure would require at least four years and about $15 billion, because the dormant existing pipeline cannot be reused. Iraq and Syria are negotiating the project, which could involve two pipelines with combined capacity of 1.5 million to 2 million barrels per day and attract U.S. company participation. The route is intended to diversify Iraq’s oil exports, support Syria’s economy and reduce Iran’s leverage over Hormuz.

Japan has reduced the immediate severity of its oil shortage by diversifying crude purchases beyond the Middle East and releasing strategic reserves through an International Energy Agency-coordinated effort. However, replacing supplies disrupted by the effective closure of the Strait of Hormuz has sharply increased costs, with Japan sourcing oil from Canada, Azerbaijan and Africa. The country’s crude import bill reached a record $89.46 billion in June, while 90% of Japanese companies surveyed said rising energy prices were harming their operations, threatening industrial activity and economic growth.

China is estimated to have added roughly 200,000 barrels per day to crude inventories in July, reversing stockpile drawdowns recorded in May and June during the Middle East crisis. Reuters calculations indicate that China had about 12.72 million bpd of crude available in July against refinery throughput of 12.51 million bpd, leaving approximately 210,000 bpd for storage. The buildup followed a rebound in imports from a decade-low in June after authorities eased some fuel-export restrictions, while subdued refinery runs and domestic demand likely contributed to the surplus. China does not publish inventory figures, but estimates suggest its commercial and strategic stocks remained near 1.2 billion barrels despite the prolonged disruption linked to the Strait of Hormuz.

China’s July retail sales and industrial output growth fell below expectations, adding to concerns about slowing economic growth and future crude oil demand. Despite the weak data, Chinese crude imports rebounded 22% from June to an average of 8.45 million barrels per day, as the country took advantage of low prices to build reserves. These stockpiles have helped limit global oil-price increases during Middle East supply disruptions, but analysts warn that China’s eventual return to international markets could support a significant price rebound.

India’s Chief Economic Adviser V. Anantha Nageswaran has urged the government to restore access to lower-ethanol petrol, such as E10, alongside mandatory E20 fuel. He argues that the option would protect older vehicles and two-wheelers, reduce public concern, and limit ethanol use while vehicle retrofits continue. The government’s E20 policy aims to cut pollution, support agriculture, and reduce crude-oil imports, but the Petroleum Ministry has rejected multiple fuel grades because of logistical challenges. Indian Oil Corporation continues to defend E20 as beneficial for energy resilience and the agricultural economy.

Heightened Houthi threats and attacks in the Bab el-Mandeb Strait and Red Sea have led Asian refiners to ask Saudi Aramco about collecting crude cargoes from Egypt’s Mediterranean port of Sidi Kerir rather than Yanbu. Aramco has already redirected some shipments there via Ain Sukhna and the SUMED pipeline, particularly for refiners in South Korea and Japan. However, the longer route around Africa raises shipping costs, prompting at least one refiner to consider abandoning its monthly allocation, while many Chinese, Indian, and Taiwanese refiners continue to collect cargoes at Yanbu.

India’s Oil and Natural Gas Corporation has received a U.S. Office of Foreign Assets Control license allowing it to resume activities in Venezuela, where it holds stakes in the San Cristobal and Carabobo oil projects. The return could give ONGC access to more than $500 million in unpaid dividends and may lead to agreements transferring project operatorship from Venezuela’s PDVSA. India has increased purchases of Venezuelan crude, along with supplies from Russia, Brazil, Nigeria and Angola, as disruptions to Middle Eastern imports continue. Venezuela’s oil exports are expected to grow substantially by 2027.

India’s Central Electricity Regulatory Commission will allow solar and wind developers that miss project deadlines to retain grid connectivity by paying $10.48 per megawatt per day, rising to three times that amount when commercial operations are delayed. The measure gives developers three months to secure land, six months to arrange financing and 12 months to commission projects. Separately, some projects facing transmission constraints may receive exemptions from transmission charges. The policies aim to prevent scarce grid-access capacity from remaining unused while helping India pursue its target of 500 GW of non-hydrocarbon generation capacity by 2030, although restrictions on imported Chinese solar components could hinder planned solar expansion.

Tanker traffic through the Strait of Hormuz fell sharply, with only five commodity vessels recorded on Saturday and none scheduled for Sunday, compared with 31 tankers the previous weekend. The decline followed reported attacks on tankers linked to ADNOC and renewed regional tensions involving Iran, the United States and the Houthis. Brent and WTI prices rose as hopes for U.S.–Iran negotiations faded and geopolitical risk premiums returned, although tankers operating with transponders switched off and a large increase in U.S. inventories limited the price gains.

Oracle’s proposed $165 billion Project Jupiter data center in New Mexico faces a six-month delay after Energy Transfer subsidiary Transwestern Pipeline postponed the Green Chile Project’s expected in-service date to February 1, 2027. The pipeline is intended to supply up to 400 million cubic feet per day of natural gas for as much as 2.5 gigawatts of Bloom Energy fuel-cell generation. Oracle has warned regulators that the delay could jeopardize the broader development, while the New Mexico State Land Office continues to withhold approval for a route crossing state-owned land. The setback highlights permitting and fuel-supply constraints facing data centers that seek dedicated power instead of waiting for grid connections.

South Africa’s Constitutional Court overturned a 2024 Supreme Court of Appeal ruling and blocked Shell and Impact Africa from conducting seismic exploration along the Wild Coast. The case was brought by local communities and environmental groups, who argued that consultation had been inadequate. The decision does not affect Shell’s other South African plans, including potential ultra-deepwater drilling in the Orange Basin and a proposed farm-in to Block 2C with PetroSA. The ruling underscores the permitting and legal challenges slowing South Africa’s offshore oil and gas development compared with neighboring Namibia.

Oil prices are on track for a roughly 5% weekly gain, with Brent approaching $100 per barrel as stalled U.S.-Iran negotiations and attacks on shipping through the Strait of Hormuz raise fears of prolonged supply disruption. A 17-million-barrel increase in U.S. crude inventories has only partly offset the bullish pressure. OPEC lowered its 2026 demand-growth forecast, while the IEA projects a sharp supply decline and a significant third-quarter deficit despite record prices reducing demand. The article also reports uncertainty over Saudi crude deliveries, disruptions to Russian fuel exports, LNG shortages affecting India, setbacks for Alaska LNG, and energy infrastructure incidents in Europe and Russia.

A tanker carrying more than 540,000 barrels of low-sulfur straight-run fuel oil from Malaysia’s PRefChem refinery is headed to a U.S. West Coast refinery, marking the first such shipment from the facility to the United States since 2023. Tight global fuel supplies, disruptions linked to the Strait of Hormuz, strong refining margins, and peak seasonal demand have made Malaysian feedstock economically attractive despite the distance. U.S. refiners are operating at high capacity while gasoline and diesel exports reach record levels amid declining inventories and supply bottlenecks.

Kazakhstan has alleged in a confidential arbitration case that the Kashagan consortium awarded roughly $10.7 billion in contracts during the 2000s with unjustifiably high costs or through bribery and self-dealing. The consortium includes KazMunayGas, Eni, Shell, ExxonMobil, TotalEnergies, CNPC and INPEX. The claim, registered with the Permanent Court of Arbitration in The Hague, has not yet been decided. It forms part of broader Kazakh claims potentially totaling about $160 billion or more over lost production, project delays, cost overruns and environmental damage. Shell CEO Wael Sawan said the dispute has reduced the company’s willingness to invest further in Kazakhstan until there is greater clarity.

Iran’s economy is nearing collapse after years of sanctions and mismanagement were compounded by a five-month war with the United States and Israel. Inflation is projected to reach 68.9 percent in 2026, while currency depreciation, unemployment, infrastructure damage and restrictions on oil exports and foreign currency have made food, medicine, utilities and fuel increasingly unaffordable. Ordinary households are cutting consumption to essentials, and protests over deteriorating conditions have prompted a deadly government crackdown. Washington is using sanctions and a naval blockade to pressure Tehran into accepting a peace deal, but Iran has resisted and used control of the Strait of Hormuz to disrupt global energy markets. Analysts warn that shortages, subsidy cuts and stagflation could drive an even deeper economic and humanitarian crisis.

India's coal demand is projected to rise from about 1.2 billion tons currently to 1.6 billion tons by 2030, driven by expanding electricity generation and industrial activity. The government plans to establish a domestic coal exchange to improve transparency, strengthen energy security and potentially support coal derivatives markets, as increased production and private-sector mining push the country from scarcity toward surplus. Coal currently supplies about 60% of India's power generation and is expected to remain central to the electricity system for at least two decades despite rapid growth in renewable capacity.

Asian refiners are increasing purchases of U.S. crude as tanker traffic through the Strait of Hormuz collapses amid the continuing U.S.-Iran stalemate. South Korea’s GS Caltex and Japan’s Cosmo Energy Holdings bought Mars crude, while Eneos and Taiwan’s CPC Corp purchased WTI at substantial premiums. Indian refiners MRPL and HPCL are also seeking a combined 6 million barrels through spot tenders as constrained Middle Eastern deliveries, tight fuel markets and high refining margins encourage continued refinery operations.

Oil traders rebuilt the risk premium in crude futures after anticipated U.S.-Iran agreement talks failed to restore normal Strait of Hormuz shipping. Traffic through the waterway remains sharply below pre-conflict levels, while attacks near the Red Sea limit alternative routes. The rally was restrained by a 17.4-million-barrel U.S. crude inventory build and weaker 2026 demand forecasts from OPEC and the IEA. WTI remains vulnerable to two-sided, headline-driven trading: renewed shipping disruptions could push prices higher, while recovering tanker traffic or further evidence of demand destruction could trigger a retreat.

A Ukrainian drone attack caused a fire at Russia’s Ust-Luga port, a major Baltic export hub for crude oil, fuel, coal, fertilizers and grain. Leningrad Region Governor Alexander Drozdenko said the fire was extinguished and that there were no casualties. The strike was part of Ukraine’s broader campaign against Russian refineries, tankers and energy supply routes. Continued attacks have contributed to Russian gasoline and diesel shortages, curtailed fuel exports and Moscow’s reported import of gasoline from India, including a shipment from the Rosneft-linked Nayara Energy refinery.

Oil tankers are increasingly switching off their AIS transponders for days or weeks while navigating the Strait of Hormuz and Bab el-Mandeb Strait, rather than only during chokepoint crossings. The extended concealment reflects rising risks from regional conflict, including Houthi attacks on Saudi-linked shipping. A Bloomberg-tracked example involved the supertanker Romania Prosperity disappearing near Fujairah for 10 days, leaving observers unable to verify whether its cargo had been transferred. The practice is reducing transparency around Middle Eastern oil flows and complicating estimates of regional exports.

Vice President JD Vance said keeping oil and gas affordable for Americans is the U.S. administration’s top priority during the war with Iran, followed by preventing Tehran from obtaining a nuclear weapon. His comments came as Washington threatened to maintain a naval blockade of Iranian oil exports indefinitely and U.S.-Iran negotiations remained stalled. Oil prices were on track for a 4% weekly increase, while the U.S. national average gasoline price stayed above $4 per gallon and reached a record high for that point in August, according to AAA and GasBuddy data.

Tanker traffic through the Strait of Hormuz fell to five crossings on Wednesday and nine on Thursday, below the monthly average, according to Kpler data cited by Reuters. Most vessels used the Iranian corridor, while 19 commodity carriers transited the Bab el-Mandeb Strait. The United States says it could sustain its naval blockade of Iran indefinitely and plans further sanctions, signaling that the standoff is unlikely to end soon. Oil prices have not yet fully reflected the geopolitical risk because traders are focused on a sharp rise in U.S. commercial inventories, but global stocks are declining and China has resumed buying more crude. Analysts warn that a prolonged impasse could trigger physical oil shortages and a sharp price increase.

Russian crude accounted for a record 50.83% of India’s oil imports in July, with shipments averaging about 2.47 million barrels per day, up 62.4% from a year earlier. Russia remained far ahead of the United Arab Emirates and Saudi Arabia as India’s leading supplier, although July volumes were slightly below June’s record. New U.S. legislation proposing 100% tariffs on countries purchasing Russian crude could threaten these flows if approved by the House, but replacing Russian supplies may be difficult while Middle Eastern conflict limits alternative sources.

Brent and WTI crude prices were on track for roughly 4% weekly gains as the United States and Iran remained far from a peace agreement. Reduced tanker traffic through the Strait of Hormuz and Washington’s threat to maintain its naval blockade indefinitely supported prices despite a 17.4-million-barrel increase in U.S. commercial crude inventories. The IEA projected a 1.8-million-barrel-per-day supply shortage for the quarter while forecasting a 1.6-million-barrel-per-day demand decline, and OPEC cut its 2026 demand-growth forecast to 580,000 barrels per day from 780,000.

The U.S. Department of Energy is preparing to provide X-energy with up to an additional $1 billion for its planned advanced nuclear project with Dow in Seadrift, Texas, bringing potential federal support since 2021 to $2.15 billion. The funding requires a 50/50 private-sector match and would support reactors designed to supply electricity and industrial steam at Dow’s petrochemical complex. X-energy and Dow are targeting operation in the early 2030s, pending regulatory approval and construction, making the project a test of whether federal cost-sharing can move advanced nuclear technology from demonstration to commercial deployment.

Oil supply disruptions, elevated fuel prices and advances in battery and charging technology could accelerate electric vehicle adoption, according to Wood Mackenzie. The consultancy forecasts global oil consumption could decline to 99 million barrels per day by 2040, while EV market share could reach 20% in the United States and 35% in Europe. Faster EV growth would require roughly $45 billion in additional metals investment, with copper emerging as a key constraint, and would place greater demands on electricity grids. Utilities and regulators would need to expand managed charging, while Western governments may need to support domestic EV technology or adopt more Chinese innovations to remain competitive.

Porsche management and its works council have reportedly agreed in principle to end Taycan production by 2030, although the company has not confirmed the plan. Taycan sales fell from 40,629 in 2023 to 16,339 in 2025, while Porsche is also facing weaker Chinese demand, U.S. tariffs, slower EV adoption and plans to cut about 9,000 jobs by 2035. The Macan EV has performed better, but Porsche has already reduced its ambition for 80% fully electric sales by 2030.

A Ukrainian drone strike caused a fire at Gazprom’s 200,000-barrel-per-day Neftekhim Salavat refinery in Russia’s Bashkortostan region, according to Ukraine’s General Staff and the regional governor. The facility had also been attacked in July. Another Urals refinery, Orsknefteorgsintez, has halted operations after repeated strikes, with repairs potentially taking six months because sanctions complicate equipment replacement. Refinery outages have contributed to Russian fuel shortages, export restrictions and gasoline imports from India. Russian refinery runs were estimated at about 3.6 million barrels per day in July, more than 30% below seasonal levels, while seaborne petroleum-product exports fell sharply. Ukraine also targeted infrastructure linked to Transneft’s Sheskharis export terminal, expanding its campaign against Russia’s refining capacity and oil-export revenues.

Romania began shutting down the last operating reactor at the Cernavoda nuclear plant after exceptionally low Danube water levels made reactor cooling difficult. The plant's two 706-MW reactors normally provide about one-fifth of Romania's electricity; one had already been taken offline in late July. Romania has restarted a 330-MW coal plant and expects to rely more on wind power, while efforts to maintain water flow using blasted rock and barges provided only temporary relief. Low river levels are also threatening Hungary's Paks nuclear plant, and heatwaves have reduced nuclear output in France.

UK North Sea decommissioning spending reached a record £2.6 billion in 2025, including £1.3 billion for well decommissioning. The North Sea Transition Authority said more than 250 wells were worked on and over 100 reached final abandonment, but about 500 wells remain in the backlog, alongside more than 1,000 additional wells expected to require decommissioning within five years. Nearly half of forecast UK Continental Shelf decommissioning costs are expected by 2032, with spending projected to exceed capital expenditure from 2029 as the basin matures and new project approvals remain limited.

India is pursuing two additional strategic petroleum reserve sites, with feasibility studies underway for a facility in Bikaner, Rajasthan, and a cavern in Bina, Madhya Pradesh. The plans complement ONGC’s proposed 13-million-barrel storage site in Mangaluru, Karnataka, half of which would be dedicated to strategic reserves. Disruptions linked to the Iran war and reduced Strait of Hormuz flows have highlighted India’s vulnerability: its existing reserves cover only about eight days of national oil demand. The Mangaluru project is expected to require roughly $1.6 billion in investment.

An Alaska Legislature bill needed to advance the Alaska LNG pipeline failed to secure sufficient support, prompting Governor Mike Dunleavy to criticize lawmakers for delaying action on a property-tax change tied to the project. Dunleavy warned that Alaska’s shortage of affordable, reliable natural gas is becoming more urgent and that further delays could increase costs, risk and investor uncertainty. The planned 800-mile pipeline would transport North Slope gas to south-central Alaska, supply in-state demand and support LNG exports to Pacific markets. The project is a partnership between Glenfarne Group and the state-owned Alaska Gasline Development Corporation, with Glenfarne reporting substantial interest from potential LNG buyers.

High international oil prices and Middle East supply disruptions have sharply improved the economics of China’s coal-to-chemicals industry. Ningxia Baofeng Energy Group, one of China’s largest producers, nearly doubled first-half profit to about $1.4 billion as oil-based olefin feedstock costs rose much faster than coal costs. The industry’s competitiveness is reinforced by China’s reliance on coal for most methanol and ammonia production, while PetroChina is pursuing expanded gas extraction from coal rock.

New Zealand Petroleum and Minerals granted Matahio NZ Onshore Limited a 10-year permit to develop the Puka oil and gas field and explore the Oru prospect in onshore Taranaki. Puka is estimated to contain about 170,000 barrels of recoverable oil and 1.3 billion cubic feet of gas, while Oru has prospective resources of 1.8 million barrels of oil and 1.2 billion cubic feet of gas. The government says the project will strengthen domestic gas supply, support electricity generation when renewable output is insufficient, and generate oil export earnings amid declining national gas reserves. The approval follows the government’s lifting of a previous offshore drilling ban and the award of New Zealand’s first offshore exploration license in years.

India proposed up to 638 million metric tons per year of new coal power capacity in the past year, nearly doubling its planned additions and driving an 11% increase in global planned capacity. Global Energy Monitor data also show that new coal mine additions worldwide fell by almost 40% to 113 million metric tons annually. India plans to raise domestic coal production to 1.15 billion metric tons in the current fiscal year and 1.5 billion metric tons in fiscal 2026/27, while reducing imports and shifting more power plants from imported to domestic coal. Coal is expected to remain central to India’s electricity system for at least two decades despite rapidly expanding renewable energy.

Hahn & Co plans to consolidate the LNG fleets of SK Shipping and H-Line Shipping. SK Shipping will receive 16 LNG carriers and associated long-term contracts in exchange for 12 tankers, contracts, and approximately $300 million, bringing its fleet to as many as 32 LNG carriers and 14 LPG vessels. H-Line will focus on tanker and bulk shipping. The restructuring reflects Hahn & Co’s strategy of shifting SK Shipping toward long-term LNG and LPG contracts as gas demand in Asia and globally is expected to rise substantially through 2050.

Oil prices declined in Asian trading after OPEC and the International Energy Agency reduced their 2026 oil-demand outlooks. The IEA now expects demand to fall by 1.6 million barrels per day, while OPEC lowered its projected growth to 580,000 barrels per day from 780,000. Continued closure of the Strait of Hormuz, renewed Middle East hostilities and stalled U.S.-Iran talks have raised price-related demand concerns. Prices were also pressured by a 17.4-million-barrel increase in U.S. crude inventories, driven mainly by higher imports and lower exports, bringing commercial stockpiles to within 2% of the five-year average.

Qatar, the United States and Argentina are leading a new wave of LNG infrastructure as rising energy-security concerns and Middle East conflict disrupt existing supply routes. The article highlights five major projects: QatarEnergy’s North Field West expansion, Alaska LNG, Argentina LNG, Rio Grande LNG in Texas and Port Arthur LNG. Together, they are intended to add substantial export capacity by the late 2020s and early 2030s, although Qatar’s facilities face multiyear repair delays after attacks and several projects still depend on securing offtake agreements, financing and final investment decisions.

Russian President Vladimir Putin threatened to seize or detain European ships if EU countries confiscate Russian vessels or cargoes linked to Moscow’s shadow oil fleet. He said Russia could retaliate in waters beyond those where European interceptions occur, while Pacific Fleet commander Viktor Liina said Russian forces could inspect ships from “unfriendly states,” including vessels sailing under third-country flags. The warning follows the EU’s expansion of sanctions to 673 shadow-fleet vessels and increased enforcement, including tanker seizures and an interception by British forces. It also comes as the U.S. Congress advances legislation targeting ships, owners, insurers and ports involved in transporting Russian oil, raising the risk of direct confrontation over commercial maritime traffic.

U.S. commercial crude oil inventories surged by 17.4 million barrels in the week ending August 7, reaching 424.4 million barrels, or 2% below the five-year seasonal average. The increase exceeded the American Petroleum Institute’s earlier estimate and pressured crude futures, although Brent and WTI remained significantly higher than a week earlier. Gasoline inventories fell by 1 million barrels, middle-distillate stocks declined by 100,000 barrels and remained 12% below their five-year average, while four-week total petroleum demand was 2.1% below the same period last year.

The United States and Gulf states are considering infrastructure to reduce dependence on the Strait of Hormuz and Bab el-Mandeb, which the article says are effectively controlled by Iran and Iran-backed Houthis. A $5 billion MERA Oil project could establish a 200,000-barrel-per-day refinery, storage, and export hub outside Hormuz, potentially in Oman or the UAE, while the India–Middle East–Europe Economic Corridor could provide additional maritime and overland alternatives. A more ambitious and secretive proposal would move Gulf oil across Saudi Arabia and Israel through the Trans-Israel Pipeline to Mediterranean ports, bypassing both chokepoints. Supporters including Israeli officials and members of Donald Trump’s team see the plan as a way to strengthen U.S. influence and the Abraham Accords, but the infrastructure would face major security risks and could provoke Iranian retaliation.

Money managers reduced bullish positions in both major crude-oil futures for a second consecutive week through August 4, cutting NYMEX WTI net longs by 7,257 lots and ICE Brent net longs by 20,361 lots, or 11%. Analysts at ING and Saxo Bank interpreted the decline as evidence of cautious sentiment and limited conviction in a sustained rally despite continuing supply risks linked to the Strait of Hormuz. Oil prices then rebounded after Iran issued six demands for a U.S. peace deal and the Houthis claimed an attack on an Aramco refinery, with Brent and WTI posting gains at the start of the week.

Europe remains heavily dependent on imported oil despite reducing its reliance on Russian fossil fuels. Citing a National Interest report, the article argues that the European Union’s next major energy crisis could result from terminal oil-production decline in exporting countries rather than from war or climate events. Aging oil fields and finite resources may gradually reduce export availability, making diversification increasingly difficult and leaving Europe vulnerable to price shocks, energy poverty and foreign coercion. The article urges faster development of domestic clean energy and longer-term planning instead of repeated short-term responses to geopolitical crises.

U.S. commercial crude inventories fell by 7.2 million barrels to 404.5 million barrels for the week ending July 24, leaving stocks 7% below the five-year average. The decline came amid heightened Strait of Hormuz tensions and U.S.-Saudi airstrikes against Iran-aligned militias in Iraq, which pushed Brent and WTI prices sharply higher. Gasoline inventories edged up, while distillate stocks rose but remained 9% below the five-year average. Average U.S. product demand over the past four weeks was 2.3% lower than a year earlier, although distillate demand increased 4.7%.