Archive · 11 Dec 2025
Billion-barrel oil glut forming at sea
There's a lot of oil sitting on ships in the ocean right now.
Normally, this oil would be sold and delivered to places like India and China, but there are problems.
Some of the oil comes from countries like Russia and Iran that have been sanctioned, which means other countries are nervous about buying it.
This has caused a big buildup of oil on the water.
Even though there's a lot of oil, the price hasn't dropped much because China is storing a lot of it.
If this oil starts to come ashore, it could cause the price of oil to drop a lot.
There are 1.4 billion barrels of oil on the water, 24% higher than the average for this time of year between 2016 and 2024.
The increase in oil on water comes from multiple sources, including a 16% year-over-year jump in barrels from mainstream producers and an 82% increase in 'dark' barrels from sanctioned producers like Russia, Iran, and Venezuela.
Geopolitics is driving the trend, with India and China being wary of making purchases from sanctioned producers due to U.S. sanctions.
The 'dark' barrels are a dilemma for the market, as they make up 15% of the world's oil supply but are hard to sell due to sanctions.
China has been adding about 290,000 barrels of oil a day into storage this year, which has helped to soak up some of the excess crude and keep oil prices relatively steady.
- Who
- Oil producers (OPEC+, Brazil, Guyana, U.S., Russia, Iran, Venezuela) and consumers (India, China)
- What
- A significant oil glut is forming at sea due to increased supply and sanctions on Russian and Iranian oil
- When
- The data is current as of the article's publication date, with a 16% year-over-year increase in barrels from mainstream producers and an 82% increase in 'dark' barrels in a year
- Where
- The oil is on the water, with a significant portion being sanctioned barrels from Russia, Iran, and Venezuela
- Why
- The increase in oil supply is due to OPEC+ unwinding production cuts and increased supply from non-OPEC exporters, while sanctions on Russian and Iranian oil are making it harder to find buyers, causing vessels to get trapped at sea
- Total oil on water
- 1.4 billion barrels
- Increase from 2016-2024 average
- 24%
- Increase in barrels from mainstream producers
- 16% year-over-year
- Increase in 'dark' barrels (sanctioned producers)
- 82% in a year
- Share of global oil supply under sanctions
- 15%
- China's daily oil storage addition
- 290,000 barrels
- China's estimated oil stockpiles this year
- 97 million barrels
