Saudi Arabia has started reducing oil production as the crucial Strait of Hormuz chokepoint remains at a near-standstill, even as the kingdom rushes to boosts exports through an alternative route. The information on the Saudi cuts, which comes from a person familiar with the operations, follows reductions by other OPEC nations including the United Arab Emirates, Kuwait and Iraq. Analysts estimate Saudi Arabia has larger storage capacity than some of its neighbors, indicating the kingdom may be pre-emptively lowering output to keep oil fields running for longer without having to completely shut them down. The oil-market’s worst fears have been realized this month as the war in the Middle East all-but closed Hormuz to shipping, forcing a swathe of massive projects to lower output and causing oil prices to surge above $100 a barrel. It’s thrown supply chains into chaos, and the longer the hostilities continue bigger the risks of a spike in global inflation. Saudi Arabia produces about 10 million barrels a day of oil and exports about 7 million a day. Aramco has been diverting some of those shipments away from its usual Hormuz route toward Yanbu in the Red Sea. But the pipeline that carries those volumes has capacity to transport 5 million barrels a day, which isn’t enough to fully replace the export volumes.
CME energy market hits record daily volume
Derivatives marketplace CME Group revealed on Monday that its energy complex surpassed the previous daily record of 7.9 million contracts set on March 3, 2026, setting a new single-day volume record of 8.3 million contracts. Additionally, CME Group Refined Products established a new single-day record of 1.25 million contracts traded on March 3, 2026, driven by RBOB Gasoline and New York Harbor Ultra-low Sulfur Diesel (ULSD) futures and options. “As geopolitical shifts drive uncertainty throughout the global energy sector, market participants are turning to CME Group to manage their risk … In these volatile market conditions, clients continue to rely on our liquid markets and benchmark products to discover prices, hedge and adjust exposure within their portfolios,” Peter Keavey, Global Head of Energy Products at CME Group Peter Keavey noted.