Oil crisis deepens beyond 1970s levels amid Iran war, IEA warns
Photo: The global energy crisis is intensifying amid the war in Iran (Getty Images)
The International Energy Agency (IEA) is consulting with governments in Asia and Europe on releasing more oil reserves to address the energy crisis caused by the war in Iran, Reuters reports.
"If it is necessary, of course, we will do it. We look at the conditions, we will analyse, assess the markets and discuss with our member countries," says IEA Executive Director Fatih Birol.
On March 11, IEA member countries agreed to release a record 400 million barrels of oil from strategic reserves to combat rising global crude oil prices.
"A stock release will help to comfort the markets, but this is not the solution. It will only help to reduce the pain in the economy," he adds.
Birol also describes the crisis in the Middle East as "very severe" and worse than the two oil shocks of the 1970s, as well as the combined impact of the Russia-Ukraine war on global gas markets.
"The single most important solution to this problem is opening the Hormuz Strait. The depth of the problem was not well appreciated by the decision makers around the world," adds the IEA’s executive director.
Background
Iran is threatening to lay sea mines and completely block the entire Persian Gulf, and the Strait of Hormuz in particular, if the US and its allies attempt to attack Iran’s coastline.
Recently, US President Donald Trump issued an ultimatum to Iran. He threatened to attack Iranian power plants if the Strait of Hormuz is not fully opened within 48 hours.
Iran also noted that the Strait of Hormuz allegedly remains open to shipping, except for vessels associated with Iran’s enemies.
