Mideast oil may soon have no way out amid ‘everything everywhere all at once’ wars, but the crisis in refined products is even worse

Fighting across the oil-producing world is catching up with energy markets, which could soon be choked off by multiple chokepoints and shortages. Over the weekend, the U.S.

and Iran have paused their attacks on each other in the Persian Gulf while they engage in diplomacy. Iran and Oman are also in separate talks to reopen the Strait of Hormuz. But the U.

S. and Iran’s neighbors are unlikely to accept any deal that recognizes Tehran’s control over the narrow waterway. Meanwhile, Iran-backed Houthi rebels are threatening ships in the Bab el-Mandeb Strait, which Saudi Arabia has relied on to export its oil and bypass the Strait of Hormuz.

Ships can get around the Bab el-Mandeb Strait by using the Suez Canal to enter or exit the Red Sea, but it can’t accommodate the largest oil tankers. There’s also a risk that Iran could try to strike the Suez Canal too. “So we are starting to talk about the kind of no way out scenarios because of this new Red Sea unrest,” Helima Croft, head of global commodity strategy at RBC Capital Markets, told CNBC on Thursday.

Elsewhere, Ukraine has been attacking Russia’s oil infrastructure nationwide as well as tankers carrying its oil and refined products in the Black Sea. Russia is one of the world’s top diesel producers, but damage to its refineries has slashed supplies, forcing Moscow to ban exports to preserve barrels for domestic consumers. “So it’s really tightening the products market as well as the crude market,” Croft added.

“And again, this administration now in Washington—they’re facing an everything everywhere all at one situation.” Indeed, adding to the fighting in Persian Gulf, Red Sea and Black Sea is a recent Ukrainian attack on an Iranian ship in the Caspian Sea suspected to ferrying military supplies between Iran and Russia. Susan Bell, senior vice president of downstream research at Rystad Energy, warned that the situation with refined fuels is worse than what’s happening with crude oil supplies.

In an interview with Bloombe