FILE PHOTO – Wintershall’s Chairman of the managing board Rainer Seele speaks during the annual press conference of the German crude oil and natural gas producer. (is associated with: «German chemicals executive sees lasting impact from Hormuz crisis») Uwe Zucchi/dpa
Global supply chains will take months to recover even if the Strait of Hormuz is reopened, Rainer Seele, former chief of the German oil and gas company Wintershall, told Handelsblatt newspaper.
“Supply chain recovery does not happen overnight but will take months,” the former Wintershall chief told the newspaper for a story published on Tuesday.
The United States and Iran are currently negotiating over reopening the strategic shipping route, through which around a fifth of global oil and liquefied natural gas supplies passed before the war. The disruption has driven up energy prices worldwide.
Seele, who oversees the global chemicals business at Abu Dhabi energy investment group XRG and chairs the supervisory board of German chemicals firm Covestro, said it would take time for oil shipments to normalize even after the route reopens.
“Strategic reserves in many countries will also be replenished first. The backlog is huge,” said Seele, who also works as a top manager at the United Arab Emirates oil company Adnoc and previously served for several years as chief executive of the Austrian energy group OMV.
Countries would first need to rebuild strategic reserves, while raw material availability was likely to remain tight well into the end of the year, he said.
Seele said energy prices should nevertheless fall quickly once a solution emerges, as much of the current price surge reflected a geopolitical risk premium. He expected crude oil prices to return to around $80 per barrel, their pre-war level.