World short nearly a billion barrels of oil, says Shell boss

• Crude stranded by war or unproduced
• Shell’s first-quarter profit up 24%
• ‘The journey back will be a long one’

The global oil market is short almost 1 billion barrels of crude after months of disruption triggered by the Iran war, the boss of Shell has warned.

Chief executive Wael Sawan said the oil had either been stranded in tankers or had never been produced.

“The hard facts are we have dug ourselves a hole of close to a billion barrels of crude shortage at the moment, either because of locked-in barrels or unproduced barrels,” Sawan said during the oil giant’s first-quarter earnings call.

“Of course, that hole is deepening every single day, so the journey back will be a long one.”

The International Energy Agency (IEA) has described the conflict as the biggest supply disruption in history.

Traffic through the Strait of Hormuz has been brought to an effective standstill. Before the war broke out on February 28, about a fifth of global oil supplies, or 20 million barrels, passed through the waterway each day.

The world had an estimated 8.2 billion barrels of emergency and commercial oil inventories before the conflict intensified, according to the IEA.

Countries coordinated the release of 400 million barrels from strategic reserves in March to prop up the market.

In the first quarter of 2026, Shell reported a 24 percent year-on-year rise in profits to $6.9 billion. It increased its dividend by 5 percent.

Higher oil prices have boosted its earnings. Brent crude has surged since the start of the war to as high as $126 a barrel. Before the conflict it was trading at about $70 a barrel.

Shell said damage to a unit at its giant Pearl gas-to-liquids project in Qatar would cost “well below half a billion dollars” to repair. It could be about a year before the facility returns to service.

The facility was targeted during Iranian strikes on Qatari energy infrastructure in March.

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Rival BP reported underlying profits of $3.2 billion for the first quarter of 2026, which was more than double the level recorded a year earlier. The company said profits reflected “exceptional oil trading” conditions during the conflict.

BP chief executive Meg O’Neill said it would take “a period of months” after the war ends for activity to normalise and warned there were still major questions over how governments would rebuild depleted strategic stocks.

Other oil majors have issued similar warnings. Chevron chief executive Mike Wirth told Reuters it could take months for exports through Hormuz to recover once the conflict ends.