The global energy system has absorbed a supply shock that was never expected to survive intact. In February, the US and Israel launched a major military campaign against Iran, and within months the market had lost roughly 15 million barrels per day of crude. Forecasts pointed to Brent crude above $150 a barrel but, six months later, oil has averaged around $90. This is due to a combination of inventories, alternative export infrastructure and one country absorbing more of the shock than forecasts anticipated.

The global energy system has absorbed an extraordinary disruption to Middle Eastern supply better than expected. China has been central to that resilience, emerging as a swing oil consumer. But with inventories declining, this balancing role is becoming a key oil market risk.

Claudio Galimberti, Chief Economist, Rystad Energy

The fourth edition of Rystad Energy’s House View examines how the market held the line for six months and why several of the mechanisms that made that possible are now running out of room. It also examines what the crisis means for the pace of the energy transition, global growth and the road ahead for oil, gas and power markets through 2040.

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Key highlights from the report: