Iran conflict triggering ‘biggest energy crisis in history,’ says IEA chief

The ongoing conflict involving Iran, the United States and Israel is driving what could become the most severe global energy crisis ever recorded, according to the head of the International Energy Agency (IEA).

IEA Executive Director Fatih Birol warned in an interview with France Inter radio on Tuesday that the current situation has already reached unprecedented levels. “This is indeed the biggest crisis in history,” he said, pointing to the combined impact of disruptions in both oil and gas markets.

The crisis has been intensified by the ongoing war in the Middle East, which has severely affected maritime traffic through the Strait of Hormuz. Disruptions in this strategic waterway have significantly strained global energy supply chains.

Fatih Birol noted that the situation has been further aggravated by the lingering effects of the Russia-Ukraine war, which had already disrupted gas supplies from Russia to Europe.

He said the cumulative impact of these overlapping crises has pushed global energy markets into uncharted territory.

Earlier this month, Birol had compared the current turmoil to past energy shocks, stating that it could surpass the combined impact of the 1973 oil crisis, the 1979 energy crisis, and the 2022 market disruptions.

In response to rising oil prices and tightening supply, the IEA announced in March the release of a record 400 million barrels of oil from strategic reserves. The move was aimed at stabilising markets and easing pressure on economies already grappling with inflation and supply shortages.

Energy analysts say the evolving geopolitical situation will continue to influence global fuel prices and economic stability, with many countries closely monitoring developments in the Middle East and beyond.