A World Living Off Its Oil Reserves
The US/Iran conflict started in Feb 2026 and it has effectively closed the Strait of Hormuz, not a day goes by without seeing a new headline on the topic. Before the war, 20M barrels of oil per day were shipped through that stretch of water, ~20% of global oil supply and Brent was ~$70 a barrel. Right now, export volumes are running at less than 10% of pre-conflict levels.
The world has been living off its strategic reserves ever since, with most coverage focusing on the daily oil price and ceasefire rumours. The more worrisome questions are: how much oil is left in those reserves, what it will cost to rebuild it, and what the global economy looks like if this does not get resolved before December.
What the Oil Reserves Look Like Currently
The International Energy Agency's (IEA) 32 member countries (US, UK, Japan, Canada, South Korea, European countries and a number of others) started the conflict holding ~1.2B barrels in strategic reserves, plus ~600M barrels of industry stocks held under government obligation. On March 11th they announced the largest coordinated emergency drawdown since the organisation was founded in 1974, releasing 400M barrels (one third of government holdings). This happened as Brent spiked to over $115 per barrel, with intraday peaks significantly higher, before settling back into the $95-110 range.
The US Strategic Petroleum Reserve (SPR) entered the conflict at ~411M barrels, down from 700M+ at its peak before years of politically motivated drawdowns (such as suppressing oil prices when war has broken out or to fund government spending). The Trump administration has since loaned a further 53.3M barrels to energy companies. API CEO Mike Sommers, speaking on CNN on June 8th, confirmed the SPR now holds ~350M barrels. With ~20% of capacity required to keep the reserve operationally functional, the effective floor sits at ~70M barrels, leaving 280M barrels of buffer. Gasoline inventories have already drawn down 38M barrels, almost equal to an entire summer driving season's worth of stock, before summer demand has even peaked. Sommers was clear, domestic production increases in the Permian Basin and Alaska cannot substitute for reopening the Strait.
To put the IEA's position in to context, 32 countries hold 1.2B barrels in government reserves. China alone had 1.4B barrels in reserves when the conflict broke out, they have spent years quietly building one of the largest strategic stockpiles on earth whilst the US and Europe were drawing down on theirs for political convenience. China has since relied on that inventory rather than overseas supply, pulling back aggressively on imports since the conflict began.
How Long Can They Hold?
The Strait carried 20M barrels per day before the conflict, even at maximum drawdown rate of 4.4M barrels per day the US SPR cannot offset that disruption alone, and actual delivery takes weeks after a drawdown is authorised. The IEA's 400M barrel release addresses just 20 days of the Strait's normal throughput.
After that release, IEA member countries retain roughly 800M barrels of government reserves, at a sustained drawdown rate the buffer covers ~40 days of normal Hormuz throughput.