Global leaders, including US President Donald Trump, have implemented a series of stopgap measures to curb soaring oil and petrol prices triggered by the Iran war. However, these efforts have failed to prevent crude oil from surpassing $100 a barrel and US petrol prices reaching an average of $4.06 per gallon.
The International Energy Agency has orchestrated the largest release of emergency oil reserves in history, with 32 member nations contributing 400 million barrels. Trump has additionally tapped the Strategic Petroleum Reserve, lifted sanctions on Russian and Iranian crude, and temporarily waived the Jones Act to ease shipping constraints. Experts, however, argue that these measures are insufficient.
Before the conflict, approximately 15 million barrels of crude and 5 million barrels of oil products passed daily through the Strait of Hormuz, representing 20% of global consumption. The disruption has taken around 10 million additional barrels per day off the market as Middle Eastern producers halt output due to full storage tanks. Eight Persian Gulf countries, holding about half of global reserves, are unable to deploy their spare capacity.
“They’re all incremental,” said Mark Barteau of Texas A&M University. “You’re talking about these different patches being at the level of maybe 1 to 2 million barrels a day each, and you’ve got to get to 20.” Jim Krane of Rice University noted that the usual emergency responder, Saudi Arabia, is also “bottled up inside the Persian Gulf.”
Saudi Arabia is using its East-West pipeline to move 5 million barrels per day, but this pipeline was already in use. Lifting sanctions on Iranian oil has not added new supply, merely widened the buyer pool, while waiving Russian sanctions could help clear stored barrels. The IEA has stressed that reopening the Strait of Hormuz is the single most critical step to stabilise markets.
