Key insights
- The IEA warns of the biggest energy crisis in history due to the Iran conflict and the Russia-Ukraine war. Disruption in the Strait of Hormuz, a key oil and LNG transit point, exacerbates the situation. The IEA released 400 million barrels of oil from strategic reserves. Higher energy prices will likely fuel inflation and negatively impact US equities.
PARIS, April 21 (Reuters) - The conflict between Iran and the United States and Israel is creating the worst energy crisis ever faced by the world, the head of the International Energy Agency (IEA) said on Tuesday.
"This is indeed the biggest crisis in history," Birol told France Inter radio in an interview broadcast on Tuesday.
"The crisis is already huge, if you combine the effects of the petrol crisis and the gas crisis with Russia," he added.
The war in the Middle East has choked up maritime traffic in the Strait of Hormuz, which is a conduit for a fifth of global oil and liquefied natural gas flows.
It has also come on top of the effects of Russia’s war with Ukraine, which had already severed Russian gas supplies to Europe.
Birol had said earlier this month that he viewed the current situation in global energy markets as worse than previous crises in 1973, 1979 and 2022 combined.
In March, the IEA agreed to release a record 400 million barrels of oil from strategic stockpiles to combat rising oil prices caused by the U.S.-Israeli war with Iran.