Oil reserves held by the world’s 38 wealthiest nations have dropped to their lowest level since 2003, with global inventories draining at a record pace as the closure of the Strait of Hormuz cuts off Middle Eastern crude and forces the United States into the role of emergency supplier for global markets, the US Energy Information Administration reported on Tuesday (9 June).
OECD stocks at a 23-year low
Inventories across the 38 nations of the , which include the US, Canada, Japan, France, the United Kingdom and South Korea, have fallen to levels not seen since 2003, according to .
The drawdown is accelerating: global oil inventories are projected to decline by 6.3 million barrels per day in the current quarter, followed by a further 7.66 million barrels per day in the third quarter, according to EIA data.
The Hormuz factor
The immediate driver is the continued closure of the Strait of Hormuz, through which a significant share of the world’s oil exports typically flows.
The Strait carried roughly 20 million barrels per day of oil and petroleum products in 2025, equivalent to about 25% of global seaborne oil trade and one-fifth of total global consumption.
That flow has since collapsed. Throughput fell by nearly 6 million barrels per day in the first quarter of 2026 to 14.6 million barrels per day, down almost 30% compared with the same period a year earlier and against 20.7 million barrels per day in the fourth quarter of 2025, according to EIA data.
Three-quarters of Hormuz crude was shipped to Asia before the conflict began, with China and India accounting for 44% of total exports through the strait. Alternative routes exist but fall well short of plugging the gap.
Saudi Arabia’s East-West pipeline has a stated capacity of 7 million barrels per day, while the UAE’s Habshan-Fujairah pipeline can carry up to 1.8 million barrels per day. Together, the IEA estimates available alternative export capacity at only 3.5 to 5.5 million barrels per day, a fraction of what the strait previously handled.
The scale of the shortfall prompted the IEA to announce a coordinated release of 400 million barrels from member countries’ emergency stocks on 11 March 2026, the largest in the organisation’s history.
Member nations held more than 1.2 billion barrels in public emergency stocks at the time, alongside around 600 million barrels of industry stocks held under government obligation. LSE
India’s four-day problem
Consultancy EY has warned that India’s strategic crude oil inventories are sufficient for only 4 to 5 days of domestic consumption, leaving the country acutely exposed to supply shocks now roiling global markets. In its Economy Watch May 2026 report, EY said the West Asia crisis had laid bare India’s dependence on imported energy and critical supplies, with global crude averaging $103.9 per barrel in April 2026, the highest level since July 2022.
“In view of the West Asian crisis and other unfavourable economic developments, a substantial reorientation of policies may be needed,” the report said.
EY called on India to build “relatively larger reserves of crude and primary commodities where India’s import dependence and vulnerability are high,” covering LPG, fertilisers, rare earth materials, essential medicines and critical medical equipment.
The report also urged faster diversification of energy import sources, acceleration of alternative trade corridors, including the India-Middle East-Europe Economic Corridor, and a broader shift towards green energy and electric vehicles to reduce long-term reliance on imported fossil fuels. “India may recast its growth strategy,” EY said.
US stocks are at their lowest since 2004
The strain is equally visible in domestic US supply figures. Total fell by 10.6 million barrels in a single week to reach 1.57 billion barrels, the lowest level since 2004.
Commercial and government crude stocks declined by 15.9 million barrels over the same period, the second-largest weekly drop on record. Surging exports to Asia and Europe, as buyers scramble to replace lost Middle Eastern supply, are driving the rapid drawdown.
The strategic reserve is draining fast
The US Strategic Petroleum Reserve fell by a further 7.9 million barrels last week. Since the start of the Iran War, the reserve has shed 58 million barrels and now stands at 357 million barrels, its lowest level since January 2024.
US oil exports: from 3 million to 13.6 million barrels per day
Before the Iran War, US crude and petroleum product exports stood at approximately 3.0 million barrels per day. That figure has since surged to 13.6 million barrels per day, the second-highest reading on record, as global markets pivot towards US supply to compensate for disrupted .
US net exports hit a record 5.8 million barrels per day in April. Officials now expect net exports to average 4.2 million for the full year, nearly three times the 1.4 million barrels per day recorded the previous year, cementing the US as the primary emergency supplier to global oil markets.
