Chevron CEO Warns Oil Buffers Are Exhausted as Prices Face Upside Risk

Chevron CEO Mike Wirth: Oil Market's Safety Buffers Have "Largely Played Out"
Chevron CEO Mike Wirth said at a University of Texas at Austin energy conference on September 11 that the mechanisms which had absorbed the oil supply shock from the U.S.-Iran conflict have largely been used up, and that prices are more likely to rise than fall over the next few months.
Wirth said measures like strategic reserve releases, drawdowns of commercial inventories, and eased restrictions on sanctioned crude "have largely now played out." He noted the loss of flexibility became more acute after attacks knocked out a major Saudi crude pipeline, putting an estimated 2.5 million barrels per day in limbo. "It's harder to envision a scenario where prices soften and quickly," he said. "I think the risks remain to the upside over the next few months."
Americans have paid about $97 billion more for fuel since the Iran war began in late February, roughly $740 extra per household, according to CNN. U.S. diesel prices hit a record $6.23 a gallon by the time Wirth spoke, while gasoline climbed back to about $4.32 a gallon. Brent crude was trading near $105 a barrel, up about 50% from roughly $70 before the war started.
Wirth's comments contrast with President Trump's September 9 statement that oil prices would come down "right after the election." Interior Secretary Doug Burgum has called the supply disruption "temporary," pointing to plans to expand Venezuelan output and U.S. refining capacity.