The calm before the storm: why oil prices rose slightly

Alexey Gromov, Principal Director on Energy studies at the Institute for Energy and Finance, commented to Forbes on the situation on the global oil market after the start of the US and Israeli military operation against Iran.

The rise in oil prices turned out to be moderate for several reasons, Alexey Gromov said. There is a surplus of oil in the world, which is estimated at 2-2.5 million bpd in February 2026, he recalls. In addition, Gromov adds, the largest oil consumers, primarily China, have accumulated large reserves. Beijing has been increasing purchases into its strategic commercial reserves over the past couple of years, hedging against the possibility of conflict in the Middle East, he points out. And now China is the largest holder of oil reserves in the world, having accumulated more than a billion barrels and ahead of the United States in this indicator, the expert notes.

In addition, he recalls, there are still about 130 million barrels of unsold oil, including Russian and Iranian. It is located on tankers off the coast of India and can be redirected to customers who need uninterrupted supplies.

Gromov believes that even if the Strait of Hormuz is closed, there will be no complete cessation of oil exports from the region. Iraq, Bahrain, Qatar and Kuwait really have no alternative supply routes to foreign markets through the strait, he says. However, Saudi Arabia has an oil pipeline that allows it to transport up to 5 million barrels of oil per day — more than half of Saudi exports — to the port of Yanbu al-Bahr on the Red Sea. The UAE has the port of Fujairah, which allows oil to be exported bypassing the Strait of Hormuz. Even Iran has a terminal in the port of Jask outside the strait, which it has not yet used. But Iran has maximally unloaded its main oil terminal on Kharq Island, through which 90% of the country's oil exports pass, and loaded this oil onto tankers that can be shipped at any time, the expert says.

If the conflict drags on for weeks or even months, Russia may have the opportunity to increase production due to funds from more expensive oil, Alexei Gromov argues.