Renewed Middle East conflict tightens oil and fuel markets as Greek prices stay elevated
The end of the Iran-US ceasefire has renewed pressure on oil supplies through the Strait of Hormuz, while shrinking crude inventories and Russia’s fuel export ban are tightening refined-product markets. In Greece, gasoline remained at €1.97 per liter even as crude fell to $77 per barrel.
Conflict ends a month of relief
The resumption of war in the Middle East, ending the ceasefire between Iran and the United States, has returned supply risk to global oil and fuel markets. Newsit.gr reports that the truce had allowed several oil cargoes to pass through the Strait of Hormuz, temporarily easing pressure on the energy sector. The renewed conflict is now confronting the market with a more acute shortage, particularly in refined fuels.
Brent crude reacted with a measured increase, reaching $77 per barrel on Monday. That remains far below earlier market levels of as much as $120 per barrel. The relatively contained crude benchmark, however, does not fully reflect the strain facing importers of gasoline, diesel and other refined products.
Inventories fall as Russian exports tighten
Global onshore crude inventories, including strategic and commercial stocks, have begun to decline and were not replenished during the month-long ceasefire, according to Newsit.gr. The result is an unusual combination of lower crude prices and thinner inventories. Any further disruption to shipments could therefore reach physical buyers more quickly than when stocks were higher.
Refined-product markets face an additional constraint from Russia’s ban on fuel exports. Russia is a major supplier in this segment, and Ukrainian drone attacks have caused problems at its refineries. Reduced Russian availability effectively transfers that pressure to other economies, increasing competition for alternative gasoline and diesel cargoes.
European refineries are operating at high rates to meet demand, while buyers are trying to secure supplies from other regions. An EU working group monitoring the energy crisis said on Friday that no problem with aviation fuel was apparent for the moment. Jet fuel nevertheless remains a major concern for Europe, making refinery performance and access to replacement imports important for airlines and fuel distributors.
Greek fuel prices diverge from crude
The tightness is visible in Greek prices even though there is no reported shortage. Gasoline traded at €1.97 per liter on Monday, while diesel stood at €1.84 per liter. On June 9, shortly before the ceasefire, crude cost $92 per barrel and Greek gasoline was €2.01 per liter. Crude has since fallen to $77, but gasoline has declined by only €0.04 per liter.
Newsit.gr attributes this mismatch to tight gasoline and diesel markets across Europe and globally. The Greek government has introduced consumer discounts of €0.10 on gasoline and €0.05 on diesel through the end of August. The support may soften retail costs, but it does not resolve the underlying shortage of tradable fuel supplies.
Qatari LNG remains constrained
The outlook is more difficult for natural gas. Qatari LNG cargoes remained minimal even during the ceasefire, and the country’s state company has extended force majeure arrangements with customers. That leaves European importers with little prospect of immediate relief from Qatar.
The EU maintains that its target of filling European gas storage sites to 90% before winter remains achievable. Progress has been slow: storage levels rose from 46.1% on June 20 to 51.8% on July 12, an increase reported as only 5.5 percentage points. With Middle Eastern supply risks elevated, Europe must compete for alternative LNG while simultaneously rebuilding inventories and maintaining high refinery output.
