Reuters: How nearly 50 days of war with Iran led to the loss of more than $50 billion worth of oil

The world has lost more than $50 billion worth of unproduced crude oil since the war with Iran began nearly 50 days ago, and the consequences of this crisis will be felt for months and even years to come, according to analysts' estimates and Reuters calculations.

Iranian Foreign Minister Abbas Araghchi said on Friday that the Strait of Hormuz had been opened following a ceasefire agreement reached in Lebanon, while United States (US) President Donald Trump said he believed a deal to end the war with Iran would come "soon," although the timing remained unclear.

Since the crisis began in late February, more than 500 million barrels of crude oil and condensate have been removed from the global market, according to Kpler (a private analytics and data company that tracks energy and commodity markets, particularly oil, gas and shipping) – representing the largest disruption to energy supplies in modern history.

In other words, 500 million barrels of oil lost to the market equals:

– a reduction in global demand for air travel over 10 weeks;

– a complete suspension of road traffic of all vehicles worldwide for 11 days;

– or the absence of oil for the global economy for five days, said Ian Muat, chief analyst at Wood Mackenzie.

– almost a month's worth of oil demand in the United States, or more than a month's worth of total oil consumption in all of Europe, according to Reuters estimates.

– approximately six years of U.S. military fuel consumption, based on annual use of about 80 million barrels in fiscal year 2021.

– an amount of fuel sufficient to power the world's international shipping industry for about four months.

Key facts:

Gulf Arab countries lost about eight million barrels per day of crude oil production in March, almost equal to the combined production of Exxon Mobil and Chevron, the world's two largest oil companies.

Jet fuel exports from Saudi Arabia, Qatar, the United Arab Emirates, Kuwait, Bahrain and Oman fell from about 19,6 million barrels in February to just 4,1 million barrels in March and April combined, according to Kpler data. That loss of exports would be enough for about 20.000 round-trip flights between New York's John F. Kennedy Airport and London's Heathrow Airport, according to Reuters estimates.

With crude oil prices averaging around $100 a barrel since the conflict began, the lost volumes represent about $50 billion in lost revenue, said Johannes Raubal, senior crude oil analyst at Kpler. That’s equivalent to a 1 percent reduction in Germany’s annual gross domestic product, or roughly the total GDP of smaller countries like Latvia or Estonia.

Full recovery could take years

Although Iranian Foreign Minister Aragchi said the Strait of Hormuz was open, the recovery of production and supply flows is expected to be slow.

Global onshore crude inventories fell by about 45 million barrels in April alone, according to Kpler data. Since the end of March, production outages have reached about 12 million barrels per day.

Heavy oil fields in Kuwait and Iraq could take four to five months to return to normal levels, Raubal said, continuing to deplete supplies through the summer. The damage to refining capacity and Qatar's Ras Laffan liquefied natural gas complex means that a full restoration of the region's energy infrastructure could take years.