Iran has launched strikes targeting critical Gulf energy infrastructure after earlier attacks on its strategic South Pars gas field, marking a sharp escalation in the ongoing US-Iran war. The retaliation reportedly hit major oil and gas facilities across Saudi Arabia, Qatar, Kuwait, the UAE, and Bahrain, disrupting operations and raising fears of a wider regional energy conflict.


US-Iran War: Iran Hits Gulf's Critical Energy Grid After South Pars Strike

In a major policy shift amid the ongoing US-Iran war, the United States has temporarily lifted sanctions on Iranian oil already at sea to ease the global energy crunch triggered by the Strait of Hormuz crisis. The 30-day waiver could release nearly 140 million barrels of crude into international markets, aiming to stabilise soaring oil prices and reduce supply disruptions.


US-Iran War: US Sanctions on Iranian Oil At Sea to Ease Crisis

The closure of the Strait of Hormuz has thrown the maritime market into disarray.
The problem lies in how to calculate the cost of hiring an oil tanker when the trade route used to calculate benchmark prices is shut down.


Oil Tanker Market’s Key Rate Thrown Into Chaos

Fuel prices are surging worldwide as crude oil climbs above critical levels amid escalating geopolitical tensions. Nearly 20 percent of global oil supply faces disruption risks through the Strait of Hormuz, triggering a broad-based energy shock.


Global Energy Shock Begins Hitting Consumers

Wall Street closed sharply lower on Friday, with benchmarks posting steep losses as inflation fears intensified and geopolitical tensions escalated. Tech giants led the decline, while small-cap stocks confirmed a correction. Investors now brace for continued volatility amid rising oil prices and uncertainty over the federal reserve’s next move.
Take a look at this next report for more.

Stocks Sink as Inflation Fears Surge Again

The price of oil and natural gas soared, as escalating attacks in the Persian Gulf caused long-term damage to major energy facilities. The third week of the war is already reshaping the global energy market for years to come.
Qatar said Iran strike damage to its key gas plant will take years to repair.

Historic Divergence: Oil Prices Across Regions

India has escalated its energy security response amid the ongoing West Asia fallout.
In a significant move, the government has now classified energy data as a national security matter, mandating real-time disclosures across the oil and gas chain. This comes even as officials admit the war is impacting supplies, but insist there’s no price hike yet. So what’s really happening on the ground?

India Tightens Grip on Oil, Gas Data

Gas prices jumped to four-year highs and oil prices rose again after an escalation of attacks by Israel and Iran on gasfields heightened fears of prolonged disruption to international energy supplies.

QatarEnergy told Reuters on Thursday that Iran had damaged facilities that produced 17% of the state-owned company’s liquefied natural gas (LNG) export capacity and that it would take three to five years to repair them.

Oil Supply Disruption Far More Worse Than What Prices Suggest?

The conflict in the West Asia has triggered an unprecedented disruption in global energy flows but Iran continues to export oil. Despite heavy attacks and near-paralysis of shipping through the Strait of Hormuz, Tehran has managed to move millions of barrels of crude, largely to China. Washington says that they are allowing Iranian ships across Hormuz to maintain global oik flow. The Strait of Hormuz, which normally carries nearly 20% of the world’s oil supply, has seen tanker traffic collapse dramatically amid escalating conflict and repeated attacks on vessels.


US Says Allowing Iranian Ships Across Hormuz to Maintain Global Oil Supply

Iran is considering allowing a limited number of oil tankers to pass through the strategic Strait of Hormuz if the cargo is traded in Chinese yuan, a senior Iranian official told CNN. The proposal is part of a broader tanker policy Tehran is developing to regulate ship traffic through the strait, one of the world’s most critical energy transit routes. As per the official, Iran is exploring options that would permit select tankers to transit the waterway under strict financial conditions. One option under discussion would require oil shipments to be sold in Chinese yuan rather than the US dollar. Most global oil transactions are conducted in US dollars.&nbsp;&nbsp;Only a small portion of sanctioned Russian oil is currently traded in alternative currencies such as the rouble or yuan. China has been pushing for years to expand the global use of its currency in energy markets, including efforts to purchase oil in yuan from major producers such as Saudi Arabia. Meanwhile, tensions surrounding shipping restrictions in the Strait of Hormuz have added volatility to global energy markets.&nbsp;Also Read: <a href="https://www.wionews.com/world/us-forces-totally-obliterate-military-targets-in-iran-s-crown-jewel-kharg-island-trump-claims-in-new-truth-social-post-1773444263312">US forces totally obliterate military targets in Iran’s crown jewel 'Kharg Island': Trump claims in new Truth Social post</a>&nbsp;Concerns about potential disruptions along the vital maritime corridor, through which a significant share of the world’s oil supply passes, have pushed global oil prices to their highest levels since July 2022, shortly after Russia launched its military operation in Ukraine. Escalating tensions involving the United States, Israel, and Iran, along with Tehran’s closure of the Strait of Hormuz, have further rattled energy markets.&nbsp;<a href="https://www.wionews.com/videos/us-announces-10-mn-reward-for-information-on-irgc-leaders-1773453550155/embed">https://www.wionews.com/videos/us-announces-10-mn-reward-for-information-on-irgc-leaders-1773453550155/embed</a><h2>Oil prices continue to swing</h2>Global oil prices dipped on Friday but were still on track for weekly gains. Brent crude futures for May delivery fell $1.22, or 1.2%, to $99.24 per barrel at 10:53 GMT. Despite the decline, the benchmark remained set for a weekly gain of around 7.5%. West Texas Intermediate crude for April delivery dropped $1.81, or 1.9%, to $93.92 per barrel, though it was still heading for an increase of nearly 4% over the week.&nbsp;Disclaimer: WION takes utmost care to accurately and responsibly report ongoing conflicts in West Asia involving Israel, Iran, the US, Gulf nations, and non-state actors like Hezbollah, Hamas, Houthis, Islamic State, and others. Claims and counterclaims, disinformation and misinformation are being made online and offline. Given this context, WION cannot independently verify the authenticity of all statements, social media posts, photos, and videos.

Iran may allow ships through Strait of Hormuz — but with a catch. Deets inside

Iran is considering allowing a limited number of oil tankers to pass through the strategic Strait of Hormuz if the cargo is traded in Chinese yuan, a senior Iranian official told CNN. The proposal is part of a broader tanker policy Tehran is developing to regulate ship traffic through the strait, one of the world’s most critical energy transit routes. As per the official, Iran is exploring options that would permit select tankers to transit the waterway under strict financial conditions. One option under discussion would require oil shipments to be sold in Chinese yuan rather than the US dollar. Most global oil transactions are conducted in US dollars. Only a small portion of sanctioned Russian oil is currently traded in alternative currencies such as the rouble or yuan. China has been pushing for years to expand the global use of its currency in energy markets, including efforts to purchase oil in yuan from major producers such as Saudi Arabia. Meanwhile, tensions surrounding shipping restrictions in the Strait of Hormuz have added volatility to global energy markets. Also Read: US forces totally obliterate military targets in Iran’s crown jewel 'Kharg Island': Trump claims in new Truth Social post Concerns about potential disruptions along the vital maritime corridor, through which a significant share of the world’s oil supply passes, have pushed global oil prices to their highest levels since July 2022, shortly after Russia launched its military operation in Ukraine. Escalating tensions involving the United States, Israel, and Iran, along with Tehran’s closure of the Strait of Hormuz, have further rattled energy markets. https://www.wionews.com/videos/us-announces-10-mn-reward-for-information-on-irgc-leaders-1773453550155/embed Oil prices continue to swing Global oil prices dipped on Friday but were still on track for weekly gains. Brent crude futures for May delivery fell $1.22, or 1.2%, to $99.24 per barrel at 10:53 GMT. Despite the decline, the benchmark remained set for a weekly gain of around 7.5%. West Texas Intermediate crude for April delivery dropped $1.81, or 1.9%, to $93.92 per barrel, though it was still heading for an increase of nearly 4% over the week. Disclaimer: WION takes utmost care to accurately and responsibly report ongoing conflicts in West Asia involving Israel, Iran, the US, Gulf nations, and non-state actors like Hezbollah, Hamas, Houthis, Islamic State, and others. Claims and counterclaims, disinformation and misinformation are being made online and offline. Given this context, WION cannot independently verify the authenticity of all statements, social media posts, photos, and videos.

According to reports, Iran may allow limited tankers through the Strait of Hormuz if oil is traded in yuan, a move that could challenge dollar dominance and impact global energy markets

The global oil market is facing its most severe supply disruption ever, drawing comparisons to the 1973 oil crisis. That year, Middle Eastern oil producers imposed an embargo on the United States and several other nations that supported Israel during the Yom Kippur War. The move caused gasoline prices to soar and triggered widespread shortages. In response, President Richard Nixon introduced emergency measures to reduce fuel consumption. Gas stations rationed gasoline, long lines formed across the country, and governments worldwide implemented strict policies to conserve energy. Some European nations even banned driving on Sundays, while Japan declared a state of emergency due to its dependence on imported oil.&nbsp;Today’s crisis, triggered by the escalating conflict involving the United States, Israel, and Iran, is threatening an even larger share of global oil supplies. Iranian attacks on energy shipping routes and infrastructure have disrupted production and transportation across the Persian Gulf. Experts say nearly 20 per cent of the world’s oil supply is now at risk, compared with about 7 per cent during the 1973 embargo. Because the conflict shows no clear path to resolution, the disruption could persist and have more severe economic consequences.&nbsp;Unlike in 1973, the United States now produces large amounts of oil domestically and relies less on Middle Eastern imports. However, global markets remain interconnected. Asian economies such as China and India depend heavily on Gulf oil, increasing competition for remaining supplies. The impact is already visible. International crude oil prices have surged toward $100 per barrel, while gasoline prices in the United States have risen more than 20 per cent since the conflict began. Prices for diesel, jet fuel, and natural gas are climbing even faster.&nbsp;Also Read: <a href="https://www.wionews.com/world/white-house-u-turn-now-begging-countries-including-india-to-buy-russian-crude-claims-iran-1773434137134">White House U-Turn: Now ‘begging’ countries, including India, to buy Russian crude, claims Iran</a>&nbsp;Research firm S&amp;P Global Energy estimates that the war has already removed about 17 million barrels per day of oil and refined products from global markets, roughly equal to most of the Persian Gulf’s previous exports. Analysts say no previous crisis has disrupted this scale. The International Energy Agency (IEA) has also described the situation as the largest supply shock in the history of the global oil market. If shipping routes remain blocked, supply shortages could worsen and push prices to record highs.&nbsp;The Trump administration has attempted to ease pressure by releasing oil from strategic reserves and lifting sanctions on Russian exports, but these measures have not significantly lowered prices so far. Despite the severity of the disruption, the world is better prepared than it was in the 1970s. Energy efficiency has improved dramatically, oil stockpiles are much larger, and renewable energy sources such as solar power play a greater role in the global energy mix. One major outcome of the 1973 crisis was the creation of the US Strategic Petroleum Reserve, which can store up to 714 million barrels of oil.&nbsp;&nbsp;<a href="https://www.wionews.com/videos/us-iran-war-us-to-deploy-more-marines-to-secure-strait-of-hormuz-amid-rising-tensions-wion-1773439195517/embed">https://www.wionews.com/videos/us-iran-war-us-to-deploy-more-marines-to-secure-strait-of-hormuz-amid-rising-tensions-wion-1773439195517/embed</a>&nbsp;Across the 32 member countries of the IEA, emergency reserves total about 1.2 billion barrels, while China holds another 1.2 billion barrels. This week, IEA members agreed to release 400 million barrels from these reserves, the largest coordinated release in history. The United States alone will release 172 million barrels over four months starting next week. However, strategic reserves contain crude oil rather than refined products like gasoline or jet fuel. As a result, releasing reserves may not directly relieve shortages in those fuels if refining capacity becomes strained.&nbsp;Even if the Strait of Hormuz reopens soon, analysts warn that oil prices may remain elevated. The longer the conflict continues, the greater the risk of lasting economic damage, including inflation, slower growth, and instability in the global market.&nbsp;Disclaimer: WION takes utmost care to accurately and responsibly report ongoing conflicts in West Asia involving Israel, Iran, the US, Gulf nations, and non-state actors like Hezbollah, Hamas, Houthis, Islamic State, and others. Claims and counterclaims, disinformation and misinformation are being made online and offline. Given this context, WION cannot independently verify the authenticity of all statements, social media posts, photos, and videos.

A historic oil supply disruption is shaking global markets. Here’s why experts say this crisis could be worse than the 1973 oil embargo.

The global oil market is facing its most severe supply disruption ever, drawing comparisons to the 1973 oil crisis. That year, Middle Eastern oil producers imposed an embargo on the United States and several other nations that supported Israel during the Yom Kippur War. The move caused gasoline prices to soar and triggered widespread shortages. In response, President Richard Nixon introduced emergency measures to reduce fuel consumption. Gas stations rationed gasoline, long lines formed across the country, and governments worldwide implemented strict policies to conserve energy. Some European nations even banned driving on Sundays, while Japan declared a state of emergency due to its dependence on imported oil. Today’s crisis, triggered by the escalating conflict involving the United States, Israel, and Iran, is threatening an even larger share of global oil supplies. Iranian attacks on energy shipping routes and infrastructure have disrupted production and transportation across the Persian Gulf. Experts say nearly 20 per cent of the world’s oil supply is now at risk, compared with about 7 per cent during the 1973 embargo. Because the conflict shows no clear path to resolution, the disruption could persist and have more severe economic consequences. Unlike in 1973, the United States now produces large amounts of oil domestically and relies less on Middle Eastern imports. However, global markets remain interconnected. Asian economies such as China and India depend heavily on Gulf oil, increasing competition for remaining supplies. The impact is already visible. International crude oil prices have surged toward $100 per barrel, while gasoline prices in the United States have risen more than 20 per cent since the conflict began. Prices for diesel, jet fuel, and natural gas are climbing even faster. Also Read: White House U-Turn: Now ‘begging’ countries, including India, to buy Russian crude, claims Iran Research firm S&P Global Energy estimates that the war has already removed about 17 million barrels per day of oil and refined products from global markets, roughly equal to most of the Persian Gulf’s previous exports. Analysts say no previous crisis has disrupted this scale. The International Energy Agency (IEA) has also described the situation as the largest supply shock in the history of the global oil market. If shipping routes remain blocked, supply shortages could worsen and push prices to record highs. The Trump administration has attempted to ease pressure by releasing oil from strategic reserves and lifting sanctions on Russian exports, but these measures have not significantly lowered prices so far. Despite the severity of the disruption, the world is better prepared than it was in the 1970s. Energy efficiency has improved dramatically, oil stockpiles are much larger, and renewable energy sources such as solar power play a greater role in the global energy mix. One major outcome of the 1973 crisis was the creation of the US Strategic Petroleum Reserve, which can store up to 714 million barrels of oil. https://www.wionews.com/videos/us-iran-war-us-to-deploy-more-marines-to-secure-strait-of-hormuz-amid-rising-tensions-wion-1773439195517/embed Across the 32 member countries of the IEA, emergency reserves total about 1.2 billion barrels, while China holds another 1.2 billion barrels. This week, IEA members agreed to release 400 million barrels from these reserves, the largest coordinated release in history. The United States alone will release 172 million barrels over four months starting next week. However, strategic reserves contain crude oil rather than refined products like gasoline or jet fuel. As a result, releasing reserves may not directly relieve shortages in those fuels if refining capacity becomes strained. Even if the Strait of Hormuz reopens soon, analysts warn that oil prices may remain elevated. The longer the conflict continues, the greater the risk of lasting economic damage, including inflation, slower growth, and instability in the global market. Disclaimer: WION takes utmost care to accurately and responsibly report ongoing conflicts in West Asia involving Israel, Iran, the US, Gulf nations, and non-state actors like Hezbollah, Hamas, Houthis, Islamic State, and others. Claims and counterclaims, disinformation and misinformation are being made online and offline. Given this context, WION cannot independently verify the authenticity of all statements, social media posts, photos, and videos.

War-linked disruptions in the Persian Gulf threaten nearly 20% of global oil supply, making it the largest oil shock in history and pushing energy prices higher

The biggest oil shock in history is unfolding — and it’s worse than 1973

After the war erupted in West Asia, the US and Israel targeted Iran’s infrastructure. Tehran retaliated by striking key facilities and targeting ships crossing the Strait of Hormuz, causing oil supply disruptions. The key question now is whether the US will force Iran to reopen the strait?

After the war erupted in West Asia, the US and Israel targeted Iran’s infrastructure. Tehran retaliated by striking key facilities and targeting ships crossing the Strait of Hormuz, causing oil supply disruptions. The key question now is whether the US will force Iran to reopen the strait?

Can US force Iran to reopen the Strait of Hormuz? Here are three real options: Check inside

Top Indian government officials are actively addressing energy security concerns following the escalation of the conflict in West Asia, with External Affairs Minister S. Jaishankar and Petroleum Minister Hardeep Singh Puri leading efforts to assure stability in oil and gas supplies amid the ongoing Iran-Israel/US tensions as of March 2026. While global oil prices have surged above USD 100 per barrel, Indian officials have stated there is "no shortage of energy in India" and are monitoring the situation closely. 


West Asia Conflict: Indian Govt Top Officials Address Energy Concerns Amid War in Iran

Nigeria is facing a new fuel market controversy after authorities suspended import licences for several major oil companies to prioritise domestic gasoline supply. Officials say permits will only be issued if local production falls short under national energy laws.

The move comes as gasoline prices surge in Nigeria due to the ripple effects of the ongoing West Asia conflict, which has pushed global oil prices higher. Authorities say the policy aims to strengthen domestic refining and reduce reliance on foreign fuel imports.

Global Oil Crisis | Nigeria: Row Over Import Gasoline Licence

The U.S. blockade of Venezuelan oil exports continues as U.S. forces seized the oil tanker Olina in the Caribbean Sea in a pre‑dawn operation. The vessel, previously sanctioned and linked to embargoed oil shipments, is the fifth tanker boarded in Washington’s intensified campaign to curb Venezuelan crude shipments amid ongoing tension over sanctions and regional strategy.


U.S. Continues Venezuelan Oil Blockade With ‘Olina’ Tanker Seizure

Venezuela Oil Crisis: U.S. Blockade Continues as Tanker ‘Olina’ Is Captured

Our past often determines our present circumstances. The ongoing turmoil in West Asia bears testimony to it.&nbsp;

As the Israel-Hamas war continues, market watchers are worried&nbsp;about the conflict's cascading effect on oil prices and the global economy. Their fears are not unfounded, but deeply rooted in recent history.

In October 1973, a coalition of Arab countries, primarily led by Egypt and Syria, surprised Israel by launching a joint attack on Yom Kippur -- the holiest day for Jews.&nbsp;

Western nations led by the United States immediately came out in support of Israel, their long-time ally in West Asia. The then&nbsp;US President Richard Nixon&nbsp;announced his decision to supply Israel with arms worth $2.2 billion.

But this announcement&nbsp;irked the oil-rich Arab world, which did not recognise Israel's right to exist as a nation. As a result, the&nbsp;OAPEC, which stands for the Organisation of Arab Petroleum Exporting Countries, decided to impose an oil embargo on the West.

Subsequently, a series of production cuts and rate&nbsp;hikes led to skyrocketing oil prices. A barrel of oil traded for around $3 before the Yom Kippur war. It rose four-folds to nearly $12 per barrel by March 1974, when the embargo was lifted.&nbsp;

The United States, a major oil consumer, was badly hit by the embargo, as fuel prices rose from an average of 39 cents per gallon to 53 cents per gallon by 1974.The oil embargo came at a wrong time for the world's largest economy.

Even before the crisis, wholesale prices of industrial commodities were rising at an annual rate of over 10 per cent, while many major industrial materials were in short supply. Moreover, it is widely believed the U.S. oil industry at the time did not posses excess production capacity, especially in times of a crisis.&nbsp;

More than the US, the embargo had a massive impact on Western Europe, ending its three-decade-long period of unaffected prosperity. For some context: Aided by the Marshall Plan, Western Europe witnessed unprecedented levels of economic boom after the second world war.

Western Europe largely depended on oil-rich West Asia for its energy needs, and the embargo not only led to high fuel prices but also exposed the region's fragile energy security. In fact, fuel rationing and dim streetlights, as seen during a wartime, became common in several European countries.&nbsp;

On a wider economic level, some estimates suggest that the oil crisis led to a 4.7 per cent decline in the US' GDP and a 2.5 per cent cut in Europe's GDP.&nbsp;

The West's loss, however, was a massive gain for the oil-producing Arab nations.&nbsp;

While the embargo ended in March 1974, oil prices remained elevated for much of the 1970s. Consequently, high prices helped several oil producing countries to maintain a healthy trade and current account surplus with the West.&nbsp;

Notably, the crisis gave rise to the term 'petro dollar', which is still used in the matters of oil trade, as the commodity is heavily traded in the official US currency.&nbsp;

But the biggest geo-economic impact of the crisis, which can be felt in 2023 too, was the mainstreaming of energy security through oil. Until then, the question of energy security rose only intermittently and was limited to a few countries.

But the global impact of the oil crisis forced countries, especially those in the developed world, to prioritise alternate energy sources and energy conservation.&nbsp;

All in all, the impact of the 1973 oil crisis reverberates to this day.&nbsp;

Our past often determines our present circumstances. The ongoing turmoil in West Asia bears testimony to it. As the Israel-Hamas war continues, market watchers are worried about the conflict's cascading effect on oil prices and the global economy.

Our past often determines our present circumstances. The ongoing turmoil in West Asia bears testimony to it. As the Israel-Hamas war continues, market watchers are worried about the conflict's cascading effect on oil prices and the global economy. Their fears are not unfounded, but deeply rooted in recent history. In October 1973, a coalition of Arab countries, primarily led by Egypt and Syria, surprised Israel by launching a joint attack on Yom Kippur -- the holiest day for Jews. Western nations led by the United States immediately came out in support of Israel, their long-time ally in West Asia. The then US President Richard Nixon announced his decision to supply Israel with arms worth $2.2 billion. But this announcement irked the oil-rich Arab world, which did not recognise Israel's right to exist as a nation. As a result, the OAPEC, which stands for the Organisation of Arab Petroleum Exporting Countries, decided to impose an oil embargo on the West. Subsequently, a series of production cuts and rate hikes led to skyrocketing oil prices. A barrel of oil traded for around $3 before the Yom Kippur war. It rose four-folds to nearly $12 per barrel by March 1974, when the embargo was lifted. The United States, a major oil consumer, was badly hit by the embargo, as fuel prices rose from an average of 39 cents per gallon to 53 cents per gallon by 1974.The oil embargo came at a wrong time for the world's largest economy. Even before the crisis, wholesale prices of industrial commodities were rising at an annual rate of over 10 per cent, while many major industrial materials were in short supply. Moreover, it is widely believed the U.S. oil industry at the time did not posses excess production capacity, especially in times of a crisis. More than the US, the embargo had a massive impact on Western Europe, ending its three-decade-long period of unaffected prosperity. For some context: Aided by the Marshall Plan, Western Europe witnessed unprecedented levels of economic boom after the second world war. Western Europe largely depended on oil-rich West Asia for its energy needs, and the embargo not only led to high fuel prices but also exposed the region's fragile energy security. In fact, fuel rationing and dim streetlights, as seen during a wartime, became common in several European countries. On a wider economic level, some estimates suggest that the oil crisis led to a 4.7 per cent decline in the US' GDP and a 2.5 per cent cut in Europe's GDP. The West's loss, however, was a massive gain for the oil-producing Arab nations. While the embargo ended in March 1974, oil prices remained elevated for much of the 1970s. Consequently, high prices helped several oil producing countries to maintain a healthy trade and current account surplus with the West. Notably, the crisis gave rise to the term 'petro dollar', which is still used in the matters of oil trade, as the commodity is heavily traded in the official US currency. But the biggest geo-economic impact of the crisis, which can be felt in 2023 too, was the mainstreaming of energy security through oil. Until then, the question of energy security rose only intermittently and was limited to a few countries. But the global impact of the oil crisis forced countries, especially those in the developed world, to prioritise alternate energy sources and energy conservation. All in all, the impact of the 1973 oil crisis reverberates to this day.

Flashback Friday: 50 years later, the impact of 1973 oil crisis continues to be felt

Oil and gasoline prices are climbing. Energy company profits are surging. President Joe Biden, who came into office promising to reduce the use of fossil fuels, has effectively joined the “drill, baby drill” chorus. Europe would love to end its dependence on Russia.

Is this the moment the U.S. oil business has been waiting for? Not exactly.

Production of oil by U.S. energy companies is essentially flat and unlikely to increase substantially for at least another year or two. If Europe were to stop buying Russian oil and natural gas as some of its leaders have promised, it won’t be able to replace that energy with fuels from the United States anytime soon.

U.S. oil production is up less than 2%, to 11.8 million barrels a day, since December and remains well below the record 13.1 million barrels a day set in March 2020 just before the pandemic paralyzed the global economy. Government forecasters predict that American oil production will average just 12 million barrels a day in 2022 and increase by roughly 1 million barrels a day in 2023. That would be well short of the nearly 4 million barrels of oil that Europe imports from Russia every day.

“You had this bombastic, chest-pounding industry touting itself as the reincarnation of the American innovative spirit,” said Jim Krane, an energy expert at Rice University. “And now that they could be leaping into action to pitch in to bring much needed oil to the world, they are being uncharacteristically cautious.”

The biggest reason oil production isn’t increasing is that U.S. energy companies and Wall Street investors are not sure that oil prices will stay high long enough for them to make a profit from drilling lots of new wells. Many remember how abruptly and sharply oil prices crashed two years ago, forcing companies to lay off thousands of employees, shut down wells and even seek bankruptcy protection.

Executives at 141 oil companies surveyed by the Federal Reserve Bank of Dallas in mid-March offered several reasons for why they weren’t pumping more oil. They said they were short of workers and sand, which is used to fracture shale fields to coax oil out of rock. But the most salient reason — the one offered by 60% of respondents — was that investors in oil companies don’t want companies to produce a lot more oil, fearing that it will hasten the end of high oil prices.

The Dallas Fed survey found that U.S. companies need oil prices to average just $56 a barrel to break even, a little more than half the current price. But some are worried that the price could fall to as little as $50 by the end of the year.

“There is a tremendous amount of muscle memory from COVID and the dramatic drop in prices,” said Ben Shepperd, president of the Permian Basin Petroleum Association in Midland, Texas. “If we were convinced oil prices would hold at levels of $75 a barrel or more for another three years, you would see a higher level of capital deployment.”

U.S. oil companies are not alone. Saudi Arabia, the United Arab Emirates and other members of the Organization of the Petroleum Exporting Countries have also refused to pump a lot more oil since Russia’s war began in late February.

This deep-seated reluctance stands in contrast to how the oil industry has typically behaved when prices have surged.

Over the past two decades, oil companies almost always responded to higher prices by investing and pumping more. A drilling frenzy accompanied the rise in prices in the early 2000s, and again in the recovery that followed the 2008 financial crisis. U.S. oil production has doubled since 2006, and the country has become a major exporter of oil, natural gas and petroleum products like gasoline and diesel.

But every price boom was followed by a huge crash — three in just the past 14 years. Scores of companies have filed bankruptcy cases. Only two years ago, oil prices plummeted by more than $50 a barrel in a single day to less than zero as the pandemic took hold and producers had no place to store oil that nobody needed to buy.

Exxon Mobil’s stock fell so much that the keepers of the Dow Jones Industrial Average kicked it off the index. The company had been in the average in one form or another since 1928, and its departure became a symbol of Wall Street’s growing distaste for fossil fuel stocks as more investors demand that companies reduce the emissions causing climate change.

Oil executives and investors cite a number of scenarios under which prices could again fall quickly. For example, Russia could lose the war and have to retreat. COVID outbreaks and lockdowns in China could hobble that country’s economy, driving down global growth and demand for energy. A new nuclear deal with Iran could open a spigot of oil exports.

Pioneer Natural Resources, a major Texas producer that last year acquired two other oil companies, is no longer aiming to increase production by 20% as it had in years past. It now aims to grow by just 5%. The company’s chief executive, Scott Sheffield, said he aimed to return 80% of its free cash flow — the cash left over after it pays its operating expenses and capital expenditures — to shareholders.

“The model has totally changed,” he said.

Oil executives also argue that they are spending a lot of money on new oil and gas production but that inflation is undercutting their efforts. Exploration and production spending will rise by more than 20% this year but about two-thirds of that increase will go toward paying higher prices for labor, materials and services, among other costs, according to RBN Energy, a research firm based in Houston.

“It is a bit of a sticker shock because we’re seeing inflation across the entire sector,” Jeff Miller, the CEO of Halliburton, which drills wells and performs other services for oil companies, told analysts on a recent conference call.

Smaller private companies, financed by private equity, are responsible for much of the new activity. According to the Dallas Fed survey, the median growth rate for companies that produce fewer than 10,000 barrels a day was projected at 15% this year, compared with only 6% for firms that produce more than 10,000 barrels a day.

Larger oil companies complain that even if they wanted to invest more, it would be hard to because Wall Street isn’t keen on financing new fossil fuel projects. Some investors who are concerned about climate change are instead choosing to put their money into renewable energy, electric cars and other businesses.

It is not that investors have become environmentalists. Many have run the numbers and concluded that the recent jump in fossil fuel prices will be short-lived and that they are better off investing in companies and industries that they believe have a brighter future.

“If you are an investor, has your view of the next five to 10 years actually changed? I think the answer is no,” said Amy Myers Jaffe, managing director at the Climate Policy Lab at Tufts University’s Fletcher School. “History tells us that oil shocks accelerate a shift to alternative energy, not the opposite.”

Many oil executives also complain that the future of their industry is clouded by political and regulatory uncertainty. They acknowledge that Biden has been calling on them to produce more but fear that his administration will go back to emphasizing the need for less oil and gas when prices fall.

“During Earth Day, the president said we have got to get off oil, and at the same time he’s begging us for 2 million additional barrels to send to Europe,” said Kirk Edwards, CEO of Latigo Petroleum, a West Texas producer. “You cannot have it both ways.”

The tension between the strategic advantages of domestic oil and gas production and the environmental costs of fossil fuel use are not likely to go away soon. Environmentalists are worried that awarding more permits for oil drilling on public lands and building new terminals to export natural gas to Europe will increase the world’s dependence on fossil fuels. But administration officials have countered that their emphasis on increasing oil and gas production will not deter longer-term efforts to make a transition to cleaner energy.

“We just can’t transition to green energy in a way that leaves us and our allies dependent on the oil of geopolitical rivals,” said Evan Ellis, a researcher at the U.S. Army War College and former State Department planner. “The ability of the U.S. to put more oil and gas into the market would be a useful weapon, enabling the Europeans to wean themselves off of Russian energy.”

David Braziel, CEO of RBN Energy, said the United States had the capacity to export more than 6 million barrels of oil a day, roughly twice what it is exporting now. While ramping up production will take time, he said the industry could produce 16 million barrels a day by 2027, more than 4 million barrels more than now, assuming prices remain high and investments increase.

“We have plenty of capacity to get extra crude oil out,” Braziel said. “We could be doing much more now than we are currently doing.”

Oil and gasoline prices are climbing. Energy company profits are surging. President Joe Biden, who came into office promising to reduce the use of fossil fuels, has effectively joined the “drill, baby drill” chorus.

Oil and gasoline prices are climbing. Energy company profits are surging. President Joe Biden, who came into office promising to reduce the use of fossil fuels, has effectively joined the “drill, baby drill” chorus. Europe would love to end its dependence on Russia. Is this the moment the U.S. oil business has been waiting for? Not exactly. Production of oil by U.S. energy companies is essentially flat and unlikely to increase substantially for at least another year or two. If Europe were to stop buying Russian oil and natural gas as some of its leaders have promised, it won’t be able to replace that energy with fuels from the United States anytime soon. U.S. oil production is up less than 2%, to 11.8 million barrels a day, since December and remains well below the record 13.1 million barrels a day set in March 2020 just before the pandemic paralyzed the global economy. Government forecasters predict that American oil production will average just 12 million barrels a day in 2022 and increase by roughly 1 million barrels a day in 2023. That would be well short of the nearly 4 million barrels of oil that Europe imports from Russia every day. “You had this bombastic, chest-pounding industry touting itself as the reincarnation of the American innovative spirit,” said Jim Krane, an energy expert at Rice University. “And now that they could be leaping into action to pitch in to bring much needed oil to the world, they are being uncharacteristically cautious.” The biggest reason oil production isn’t increasing is that U.S. energy companies and Wall Street investors are not sure that oil prices will stay high long enough for them to make a profit from drilling lots of new wells. Many remember how abruptly and sharply oil prices crashed two years ago, forcing companies to lay off thousands of employees, shut down wells and even seek bankruptcy protection. Executives at 141 oil companies surveyed by the Federal Reserve Bank of Dallas in mid-March offered several reasons for why they weren’t pumping more oil. They said they were short of workers and sand, which is used to fracture shale fields to coax oil out of rock. But the most salient reason — the one offered by 60% of respondents — was that investors in oil companies don’t want companies to produce a lot more oil, fearing that it will hasten the end of high oil prices. The Dallas Fed survey found that U.S. companies need oil prices to average just $56 a barrel to break even, a little more than half the current price. But some are worried that the price could fall to as little as $50 by the end of the year. “There is a tremendous amount of muscle memory from COVID and the dramatic drop in prices,” said Ben Shepperd, president of the Permian Basin Petroleum Association in Midland, Texas. “If we were convinced oil prices would hold at levels of $75 a barrel or more for another three years, you would see a higher level of capital deployment.” U.S. oil companies are not alone. Saudi Arabia, the United Arab Emirates and other members of the Organization of the Petroleum Exporting Countries have also refused to pump a lot more oil since Russia’s war began in late February. This deep-seated reluctance stands in contrast to how the oil industry has typically behaved when prices have surged. Over the past two decades, oil companies almost always responded to higher prices by investing and pumping more. A drilling frenzy accompanied the rise in prices in the early 2000s, and again in the recovery that followed the 2008 financial crisis. U.S. oil production has doubled since 2006, and the country has become a major exporter of oil, natural gas and petroleum products like gasoline and diesel. But every price boom was followed by a huge crash — three in just the past 14 years. Scores of companies have filed bankruptcy cases. Only two years ago, oil prices plummeted by more than $50 a barrel in a single day to less than zero as the pandemic took hold and producers had no place to store oil that nobody needed to buy. Exxon Mobil’s stock fell so much that the keepers of the Dow Jones Industrial Average kicked it off the index. The company had been in the average in one form or another since 1928, and its departure became a symbol of Wall Street’s growing distaste for fossil fuel stocks as more investors demand that companies reduce the emissions causing climate change. Oil executives and investors cite a number of scenarios under which prices could again fall quickly. For example, Russia could lose the war and have to retreat. COVID outbreaks and lockdowns in China could hobble that country’s economy, driving down global growth and demand for energy. A new nuclear deal with Iran could open a spigot of oil exports. Pioneer Natural Resources, a major Texas producer that last year acquired two other oil companies, is no longer aiming to increase production by 20% as it had in years past. It now aims to grow by just 5%. The company’s chief executive, Scott Sheffield, said he aimed to return 80% of its free cash flow — the cash left over after it pays its operating expenses and capital expenditures — to shareholders. “The model has totally changed,” he said. Oil executives also argue that they are spending a lot of money on new oil and gas production but that inflation is undercutting their efforts. Exploration and production spending will rise by more than 20% this year but about two-thirds of that increase will go toward paying higher prices for labor, materials and services, among other costs, according to RBN Energy, a research firm based in Houston. “It is a bit of a sticker shock because we’re seeing inflation across the entire sector,” Jeff Miller, the CEO of Halliburton, which drills wells and performs other services for oil companies, told analysts on a recent conference call. Smaller private companies, financed by private equity, are responsible for much of the new activity. According to the Dallas Fed survey, the median growth rate for companies that produce fewer than 10,000 barrels a day was projected at 15% this year, compared with only 6% for firms that produce more than 10,000 barrels a day. Larger oil companies complain that even if they wanted to invest more, it would be hard to because Wall Street isn’t keen on financing new fossil fuel projects. Some investors who are concerned about climate change are instead choosing to put their money into renewable energy, electric cars and other businesses. It is not that investors have become environmentalists. Many have run the numbers and concluded that the recent jump in fossil fuel prices will be short-lived and that they are better off investing in companies and industries that they believe have a brighter future. “If you are an investor, has your view of the next five to 10 years actually changed? I think the answer is no,” said Amy Myers Jaffe, managing director at the Climate Policy Lab at Tufts University’s Fletcher School. “History tells us that oil shocks accelerate a shift to alternative energy, not the opposite.” Many oil executives also complain that the future of their industry is clouded by political and regulatory uncertainty. They acknowledge that Biden has been calling on them to produce more but fear that his administration will go back to emphasizing the need for less oil and gas when prices fall. “During Earth Day, the president said we have got to get off oil, and at the same time he’s begging us for 2 million additional barrels to send to Europe,” said Kirk Edwards, CEO of Latigo Petroleum, a West Texas producer. “You cannot have it both ways.” The tension between the strategic advantages of domestic oil and gas production and the environmental costs of fossil fuel use are not likely to go away soon. Environmentalists are worried that awarding more permits for oil drilling on public lands and building new terminals to export natural gas to Europe will increase the world’s dependence on fossil fuels. But administration officials have countered that their emphasis on increasing oil and gas production will not deter longer-term efforts to make a transition to cleaner energy. “We just can’t transition to green energy in a way that leaves us and our allies dependent on the oil of geopolitical rivals,” said Evan Ellis, a researcher at the U.S. Army War College and former State Department planner. “The ability of the U.S. to put more oil and gas into the market would be a useful weapon, enabling the Europeans to wean themselves off of Russian energy.” David Braziel, CEO of RBN Energy, said the United States had the capacity to export more than 6 million barrels of oil a day, roughly twice what it is exporting now. While ramping up production will take time, he said the industry could produce 16 million barrels a day by 2027, more than 4 million barrels more than now, assuming prices remain high and investments increase. “We have plenty of capacity to get extra crude oil out,” Braziel said. “We could be doing much more now than we are currently doing.”

Why US oil companies aren’t riding to Europe’s rescue

Sri Lanka was handed temporary relief from energy shortages and rolling blackouts on Wednesday with a $500 million loan from India to finance urgent oil purchases for the cash-strapped nation.

The island's economic woes have left thermal power generators unable to keep the lights on and disrupted transport networks, as traders run desperately low on foreign currency to fund imports.

Frequent breakdowns at a huge coal power plant have compounded unannounced electricity cuts and households are also struggling to source cooking gas and kerosene.

Officials said a formal agreement was being signed on Wednesday after two weeks of talks, in addition to a recent $915 million in foreign exchange support.

An Indian diplomat said talks were underway on another $1 billion credit line to fund urgently needed food and medicine imports from India.

"The $500 million is for Sri Lanka to purchase petroleum products from Indian suppliers," the official said.

Sri Lanka's economy is also seeing a scarcity of rice, automotive parts and cement, with supermarkets forced to ration some staple foods.

The shortages pushed food inflation to a record 25 per cent last month.

Tourism is a key foreign exchange earner for Sri Lanka but the sector has collapsed in the wake of the Covid-19 pandemic.

The government has shut overseas diplomatic missions to save money and a broad ban on imports has been in effect for nearly two years to conserve foreign currency.

Three international rating agencies have downgraded the island since late last year on fears it may not be able to service its $35 billion sovereign debt.

Sri Lanka has sought more loans from Beijing to help repay its existing Chinese debt, which accounts for about 10 per cent of the country's external borrowings.

Authorities have borrowed heavily from China for infrastructure projects in the past, some of which ended up as costly white elephants.

Sri Lanka was handed temporary relief from energy shortages and rolling blackouts on Wednesday with a $500 million loan from India to finance urgent oil purchases for the cash-strapped nation.

Sri Lanka was handed temporary relief from energy shortages and rolling blackouts on Wednesday with a $500 million loan from India to finance urgent oil purchases for the cash-strapped nation. The island's economic woes have left thermal power generators unable to keep the lights on and disrupted transport networks, as traders run desperately low on foreign currency to fund imports. Frequent breakdowns at a huge coal power plant have compounded unannounced electricity cuts and households are also struggling to source cooking gas and kerosene. Officials said a formal agreement was being signed on Wednesday after two weeks of talks, in addition to a recent $915 million in foreign exchange support. An Indian diplomat said talks were underway on another $1 billion credit line to fund urgently needed food and medicine imports from India. "The $500 million is for Sri Lanka to purchase petroleum products from Indian suppliers," the official said. Sri Lanka's economy is also seeing a scarcity of rice, automotive parts and cement, with supermarkets forced to ration some staple foods. The shortages pushed food inflation to a record 25 per cent last month. Tourism is a key foreign exchange earner for Sri Lanka but the sector has collapsed in the wake of the Covid-19 pandemic. The government has shut overseas diplomatic missions to save money and a broad ban on imports has been in effect for nearly two years to conserve foreign currency. Three international rating agencies have downgraded the island since late last year on fears it may not be able to service its $35 billion sovereign debt. Sri Lanka has sought more loans from Beijing to help repay its existing Chinese debt, which accounts for about 10 per cent of the country's external borrowings. Authorities have borrowed heavily from China for infrastructure projects in the past, some of which ended up as costly white elephants.

Sri Lanka receives urgent $500 million loan from India to pay for oil

Saudi Arabia is going through a crisis this year. The Kingdom is witnessing shrinking economy, budgets have been cut, their oil tankers are being targeted, and has suffered four terror attacks in the past month.

Also read:&nbsp;<a href="https://www.wionews.com/world/amid-pandemic-crown-prince-mohammad-bin-salman-challenges-saudi-arabias-old-order-350277" hreflang="en">Amid pandemic, Crown Prince Mohammad bin Salman challenges Saudi Arabia's old order</a>

Despite all this, the game of thrones in the country continues. Crown Prince Mohammad bin Salman is carrying out another royal purge.&nbsp;

It's being called the mini Ritz, a smaller version of the major crackdown that took place in 2017 when scores of royals were detained in the Ritz Carlton hotel in Riyadh. &nbsp;

Saudi Arabia's churn is not unique. All oil economies have been forced into a hard reset this year. But given Saudi Arabia's stature in the region, it's challenges appear more pronounced and has a bearing on others.

The economic crisis in the country is driven by a sole factor, oil. It hit rock bottom this year as&nbsp;oil prices fell below zero. However, it has&nbsp;recovered since, but the rates remain at an all-time low.&nbsp;

Demand has plummeted and producers are leaving more supplies in the ground, due to this, Riyadh is making unprecedented cuts to its budget. The Kingdom of Saudi Arabia wants to cut spending by 7.3 per cent.

Riyadh is running a budget deficit because of coronavirus pandemic. The Kingdom expects to be short of close to $80 billion this year which is around 12 per cent of Saudi Arabia's GDP.&nbsp;

With a deficit so huge, Riyadh has no options but to cut spending. It wants to slash spending to $264 billion this year. This is expected to bring the deficit down to less than five per cent of the GDP.

The pandemic has hit demand in oil&nbsp;due to which prices have dropped. Riyadh is no longer earning what&nbsp;it used to from oil.&nbsp;

Saudi Arabia hasn't given a breakdown for oil and non-oil revenue in its budget. Saudi Arabia's oil infrastructure is under attack by two means. First, the pandemic, and second, extremists are attacking Saudi oil tankers.

This is the second time that an oil tanker was targeted in recent weeks. Two days ago, a fuel transport ship was attacked. A boat laden with explosives rammed into it. It happened when the tanker was anchored at the port of Jeddah. It's an important port because of its unique location.

It is right in the middle of the international shipping route between the west and the east. No one was hurt but some oil may have leaked.

Saudi Arabia is calling this a terrorist attack. This explosion is the latest in a series of attacks against the Kingdom. Earlier, a mine exploded and damaged a ship off the coast of Saudi Arabia. Riyadh had blamed Yemen's Houthi rebels for this. Another attack targeted a cargo ship in Yemen's far east.

However, the crisis is not limited to the economy. Saudi Arabia is suffering a setback on the diplomatic front too. Germany has extended its ban on arms sales to Riyadh for another year. It was first imposed in 2018 after the death of journalist Jamal Khashoggi.&nbsp;

It couldn't have come at a worse time for Saudi Arabia because France and Canada are also facing calls to revisit arms deals with Riyadh. US President-elect Joe Biden is facing similar demands. The German ban sets a difficult precedent for Riyadh.

Despite the crisis, the Kingdom is going through a royal purge.&nbsp;

Saudi Arabia is going through a crisis this year. The Kingdom is witnessing shrinking economy, budgets have been cut, their oil tankers are being targeted, and has suffered four terror attacks in the past month.

Saudi Arabia is going through a crisis this year. The Kingdom is witnessing shrinking economy, budgets have been cut, their oil tankers are being targeted, and has suffered four terror attacks in the past month. Also read: Amid pandemic, Crown Prince Mohammad bin Salman challenges Saudi Arabia's old order Despite all this, the game of thrones in the country continues. Crown Prince Mohammad bin Salman is carrying out another royal purge. It's being called the mini Ritz, a smaller version of the major crackdown that took place in 2017 when scores of royals were detained in the Ritz Carlton hotel in Riyadh. Saudi Arabia's churn is not unique. All oil economies have been forced into a hard reset this year. But given Saudi Arabia's stature in the region, it's challenges appear more pronounced and has a bearing on others. The economic crisis in the country is driven by a sole factor, oil. It hit rock bottom this year as oil prices fell below zero. However, it has recovered since, but the rates remain at an all-time low. Demand has plummeted and producers are leaving more supplies in the ground, due to this, Riyadh is making unprecedented cuts to its budget. The Kingdom of Saudi Arabia wants to cut spending by 7.3 per cent. Riyadh is running a budget deficit because of coronavirus pandemic. The Kingdom expects to be short of close to $80 billion this year which is around 12 per cent of Saudi Arabia's GDP. With a deficit so huge, Riyadh has no options but to cut spending. It wants to slash spending to $264 billion this year. This is expected to bring the deficit down to less than five per cent of the GDP. The pandemic has hit demand in oil due to which prices have dropped. Riyadh is no longer earning what it used to from oil. Saudi Arabia hasn't given a breakdown for oil and non-oil revenue in its budget. Saudi Arabia's oil infrastructure is under attack by two means. First, the pandemic, and second, extremists are attacking Saudi oil tankers. This is the second time that an oil tanker was targeted in recent weeks. Two days ago, a fuel transport ship was attacked. A boat laden with explosives rammed into it. It happened when the tanker was anchored at the port of Jeddah. It's an important port because of its unique location. It is right in the middle of the international shipping route between the west and the east. No one was hurt but some oil may have leaked. Saudi Arabia is calling this a terrorist attack. This explosion is the latest in a series of attacks against the Kingdom. Earlier, a mine exploded and damaged a ship off the coast of Saudi Arabia. Riyadh had blamed Yemen's Houthi rebels for this. Another attack targeted a cargo ship in Yemen's far east. However, the crisis is not limited to the economy. Saudi Arabia is suffering a setback on the diplomatic front too. Germany has extended its ban on arms sales to Riyadh for another year. It was first imposed in 2018 after the death of journalist Jamal Khashoggi. It couldn't have come at a worse time for Saudi Arabia because France and Canada are also facing calls to revisit arms deals with Riyadh. US President-elect Joe Biden is facing similar demands. The German ban sets a difficult precedent for Riyadh. Despite the crisis, the Kingdom is going through a royal purge.

Saudi Arabia carries out royal purge despite economic crisis, pandemic

A Venezuelan vessel, is at risk of spilling millions of gallons of oil in the Gulf of Paria in the Caribbean Sea, raising environmental concerns for the region.

Tilting oil tanker on brink of sinking; Oil crisis unfolding in Gulf of Paria

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