Oil Reserves Thin, Global Economy Squeezes

JAKARTA - The International Energy Agency (IEA) has warned that global crude oil reserves are shrinking, eroding one of the main buffers in the face of the largest oil supply shock in history.

"The global economy is not completely safe," IEA Executive Director Fatih Birol told CNN on Thursday, July 16.

Various countries have compensated for the loss of oil supplies from the Middle East by relying on increased production from other regions. Alternative routes for transporting crude oil out of the region - such as Saudi Arabia's East-West pipeline - have also helped mitigate the impact of rising oil prices.

"However, this situation cannot last long because global crude oil reserves continue to decline," Birol warned.

The world relies heavily on strategic oil reserves to cover the loss of more than 1 billion barrels of oil since the start of the Iran war.

According to IEA data, global oil reserves fell by 360 million barrels between March and May, then recovered slightly in June thanks to an increase in the volume of oil being shipped by sea (oil on board), although various countries continue to use their strategic reserves.

Oil prices have surged this month, after falling to pre-war levels in recent weeks.

Brent crude, which serves as a benchmark for global oil prices, rose about US$13 to almost US$85 per barrel. Meanwhile, West Texas Intermediate (WTI) - the United States' benchmark oil - jumped more than US$10 to reach just below US$80 per barrel.