Eni Warns Oil Market Risks Breaking Out of Current Range if Iran War Continues

The global oil market faces significant risks of price volatility and inflation if the Middle East conflict persists, according to Claudio Descalzi, CEO of Italian energy giant Eni. He predicts that oil prices, currently oscillating between $80 and $100 per barrel, could break out of this range by the first quarter of 2027 at the latest.

Descalzi explained that the release of strategic oil stockpiles has so far helped to contain prices, but this approach is unsustainable. He emphasized that relying on dwindling reserves carries growing risks, as global reserves are finite. "The long-term solution is greater energy security through diversification of supply sources and routes," he stated in an interview with Il Sole 24 Ore.

“

The global oil market will break out of its roughly $80-$100 range by the first quarter of 2027 at the latest, boosting inflation and reducing energy demand, if the Middle East conflict continues.

The CEO pointed to the increasing disruption of shipments, particularly through the Strait of Hormuz, as a major concern. He noted that global oil stocks have seen a significant decline, with daily drawdowns accelerating in recent months due to the conflict. Descalzi advised countries to focus on producers in Africa, Latin America, and Southeast Asia, while reducing reliance on potentially vulnerable maritime passages.

The urgency for secure energy supplies is amplified by the burgeoning power demands of artificial intelligence technologies and the rapid expansion of data centers worldwide. Eni itself has strategically limited its exposure to the Middle East, concentrating its upstream production in Africa and Latin America.

“

The long-term solution is greater energy security through diversification of supply sources and routes.