Oil executives declare ‘great fuel crisis’ has arrived

The global oil market is under its most intense pressure in decades as three critical chokepoints — the Strait of Hormuz, Saudi Arabia's East-West pipeline, and the Bab el-Mandeb Strait — face simultaneous disruption, pushing Brent crude above $108 a barrel and U.S. diesel prices to record highs.

The Wall Street Journal News Corp ↘ 2.07% reported Monday that American oil executives now say a "great fuel crisis" has arrived, warning that commercial fuel inventories worldwide have been declining for over six months and strategic crude reserves are nearing their limits for extraction. The crisis escalated sharply last week after a drone attack on September 11, launched from Iraq, struck pump stations along Saudi Arabia's 1,200-kilometer East-West pipeline, forcing Riyadh to shut the conduit as a precautionary measure.wsj+2

A Triple Chokepoint Shock

The East-West pipeline had been carrying crude from Saudi Arabia's eastern oil fields to the Red Sea port of Yanbu, bypassing the largely closed Strait of Hormuz. With the pipeline offline, Yanbu now has stocks sufficient for just five to seven days of exports, according to Reuters, citing three industry sources familiar with Saudi shipments. The pipeline can carry roughly 4 million barrels per day, and its closure threatens the loss of up to 4 percent of global oil supply.reuters

Compounding the disruption, Iran-backed Houthi forces have seized Yemen's port city of Mocha and advanced along the Red Sea coast, bringing them closer to controlling the Bab el-Mandeb Strait — a critical shipping route that had been used as an alternative to the Persian Gulf. DW reported that the Houthi advance has raised concerns over energy flows through the strait.reuters+2

Fuel Prices Hit Records

The cascading supply losses have sent prices surging. Brent crude spiked to $108.49 a barrel at the Asian market opening on Monday, September 14, according to Rigzone. The U.S. national average diesel price surpassed $6 a gallon for the first time on September 11, reaching $6.06 according to AAA. Reuters reported the milestone was driven by the combined effects of the Iran war and Ukrainian attacks on Russian refineries.rigzone+3

The crisis traces back to the U.S.-Israeli military operation against Iran launched in February 2026, which led to the near-total closure of the Strait of Hormuz — through which roughly 20 percent of the world's oil trade normally flows. The International Energy Agency has called it the "largest supply disruption in the history of the global oil market".wikipedia

No Clear Path to Resolution

Despite U.S. efforts to loosen Iran's grip on Hormuz, progress has been limited. The war, originally expected to last weeks, continues with no diplomatic breakthrough since a failed agreement in June. President Trump said last week that he expected the conflict to end after the U.S. midterm elections, adding that the situation would "work out fine". For now, analysts warn that prices could climb further, with Standard Chartered forecasting Brent could reach $110 a barrel as refining capacity losses in the Middle East keep refined product prices elevated.chron+3