Eni SpA's chief executive, Claudio Descalzi, cautioned that global crude markets risk breaking above the recent $80-$100 per barrel range and could top $100 by the first quarter of 2027 if conflict in the Middle East continues. In an interview published in an Italian newspaper, Descalzi said measures taken so far to temper price spikes are finite and the market remains vulnerable to prolonged geopolitical disruption.
According to Descalzi, emergency releases from strategic oil stockpiles have helped avert a sharper immediate rise in prices, but those interventions cannot be maintained indefinitely because global reserve levels are limited. He warned that, with reserves finite, the market will be more exposed to price volatility if tensions persist.
Market moves over the past week reflected those geopolitical concerns. Oil prices closed the week with solid gains even though they eased back from midweek peaks. Renewed hostilities between the U.S. and Iran and attacks on shipping in the Strait of Hormuz sustained a geopolitical risk premium in markets, keeping prices elevated.
Brent crude futures settled at around $76 a barrel, registering about a 5.4% gain for the week, while West Texas Intermediate futures gained roughly 4% to near $71.40. Both benchmarks retreated on Friday after investors took positions that the latest flare-up would remain contained and not cause major disruption to Middle East oil shipments.
Descalzi framed the longer-term solution as one of energy security and diversification. He advocated broadening energy ties with producers across North Africa, sub-Saharan Africa, Latin America and Southeast Asia, and reducing reliance on politically sensitive maritime chokepoints and single-source supply chains. That, he suggested, would lessen the market's exposure to regional shocks.
He noted that Eni itself has limited direct exposure to the Middle East: the company's upstream production is concentrated in Africa and Latin America, which has left it relatively insulated from the current regional disruptions. Still, the global market as a whole remains susceptible, he said.
Descalzi also pointed to inventory trends, saying global oil stocks have been drawn down as supply disruptions associated with the Iran conflict intensified, with stock draws accelerating in recent months. He warned that a sustained decline in inventories would heighten the market's sensitivity to additional geopolitical developments.
Beyond crude markets, Descalzi highlighted a parallel demand-side development: the rapid expansion of artificial intelligence and data centre capacity is driving a sharp increase in electricity consumption. That trend, he said, adds urgency to securing reliable and diversified energy supplies across both oil and power markets.
Implications and outlook
Descalzi's comments underscore two immediate concerns for energy markets: the temporary nature of emergency reserve releases and accelerating inventory draws amid heightened geopolitical risk. Together, those dynamics could push oil prices materially higher if the Middle East conflict persists.
At the same time, shifts in energy demand driven by technology infrastructure underline the need for broader energy security planning beyond crude alone.