The Middle East war triggered the world's largest energy shock with market recovery likely to extend into 2027 even if the Hormuz blockade is lifted soon, Saudi oil giant Aramco's CEO told investors Monday.
A day earlier, Aramco had announced a net profit rise of more than 25 per cent in the first quarter of 2026 compared to the same period last year, fuelled by higher oil prices as exports remain blocked in the Strait of Hormuz.
"The energy supply shock that began in the first quarter is the largest the world has ever experienced," said Aramco CEO and president Amin H. Nasser.
"If the Strait of Hormuz opens today, it will still take months for the market to rebalance, and if its opening is delayed by a few more weeks, then normalisation will last into 2027," he added.
Crude prices jumped during the first quarter from the mid $60s in early February to more than $100 a barrel in March as Iran's shutdown of the key waterway sparked a global energy crisis.
The market has seen an "unprecedented supply loss of about a billion barrels of oil", he said, putting the figure at roughly 880 million barrels.
"If the current disruptions continue at this rate, the market will lose around 100 million barrels for every week the Strait of Hormuz remains closed," he added.
The loss was offset in part by oil flows bypassing Hormuz, the release of strategic government petroleum reserves and Saudi Arabia's East-West pipeline -- which avoids the blockaded strait, he said.
Saudi Arabia has used the pipeline at its maximum capacity of 7 million barrels per day to deliver oil despite the blockade.
US-Iran talks have failed to produce a lasting deal following a truce last month, with US President Trump on Sunday rejecting Tehran's response to Washington's proposal as "totally unacceptable".
"If and when normal trade and shipping resumes, we anticipate very robust return to demand growth significantly higher than the initial estimate for the growth in 2026," Nasser said.
The oil-rich Gulf has borne the brunt of Iran's attacks during the war, with Tehran targeting US assets but also civilian infrastructure including energy facilities.
In Saudi Arabia, facilities in Riyadh, the Eastern Province and the industrial city of Yanbu were all targeted. This included infrastructure for oil and gas production, transport and refining, and petrochemical plants and power facilities.
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