Archive · 28 Aug 2026
Iran War Drives Record Global Oil Crisis Amid Conflicts
Several major oil-producing countries are involved in wars or other conflicts.
Together, they normally provide almost half of the world’s oil.
Attacks involving Iran have disrupted oil shipments in the Gulf.
Some oil is being secretly moved around the Strait of Hormuz, but millions of barrels per day remain affected.
Fighting in Ukraine has also damaged Russian refineries.
This has reduced the amount of fuel that can be made worldwide.
Fuel prices have risen, which can make many other things more expensive.
Countries have used emergency oil reserves to help, but those reserves are nearly used up and oil supplies are still falling.
Countries affected by conflict produced about 45 million barrels per day in 2025, representing more than 43% of global oil supply.
The Iran-related Gulf disruption is estimated at 5 million to 7 million barrels per day.
Conflicts in the Gulf and Ukraine have cut global refining capacity by about 10%.
Ukraine’s attacks on Russian refineries have contributed to fuel shortages and Russia’s ban on gasoline and diesel exports.
Emergency oil-stockpile releases by the International Energy Agency are largely complete while global inventories continue to decline.
- Who
- Iran, Israel, the United States, Russia, Ukraine, Libya, Venezuela and other conflict-affected oil-producing countries are involved in the reported disruptions.
- What
- Wars, attacks, export restrictions and refinery damage have disrupted oil production, transport and refining, creating what Reuters describes as the largest oil supply crisis on record.
- When
- The report was published on Aug. 25, six months after U.S. and Israeli attacks on Iran; the calculations use 2025 oil output and describe conditions in 2026.
- Where
- The disruptions involve the Gulf, the Strait of Hormuz, the Red Sea, the Suez Canal, Russia, Ukraine, Libya, Venezuela and Kazakhstan.
- Why
- Conflict-related attacks and restrictions have reduced oil flows and refining capacity, increasing fuel prices and pressure on global inventories.
- Conflict-affected oil supply
- About 45 million barrels per day, or more than 43% of global supply based on 2025 output.
- Gulf disruption
- Analysts estimate current Gulf oil disruption at 5 million to 7 million barrels per day.
- Refining capacity loss
- Global refining capacity has fallen by about one-tenth because of conflicts in the Gulf and Ukraine.
- Russia’s fuel measures
- Russia has banned gasoline and diesel exports while dealing with fuel shortages.
- Oil reserves
- The International Energy Agency has released record volumes from emergency stockpiles, and those releases are largely complete.
- Global inventories
- Oil inventories continue to decline.
- U.S. fuel prices
- U.S. diesel prices have reached record levels despite refiners operating at peak capacity.