Power crunch prompted by Iran warfare poses ‘main menace’ to international financial system, Fatih Birol says.
Revealed On 23 Mar 2026
The world is going through a worse power disaster than the dual oil shocks of the Seventies and the fallout of the Ukraine warfare mixed, the top of the Worldwide Power Company (IEA) has warned.
Talking at a media occasion in Australia on Monday, IEA Government Director Fatih Birol stated the power crunch prompted by the US-Israel warfare on Iran exceeded the 1973 and 1979 oil shocks and gasoline shortages stemming from Russia’s 2022 invasion of Ukraine put collectively.
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“This disaster, as issues stand, is now two oil crises and one gasoline crash put all collectively,” Birol stated in remarks to the Nationwide Press Membership of Australia in Canberra.
Birol stated the efficient closure of the Strait of Hormuz and assaults on power amenities had lowered international oil provides by about 11 million barrels per day (bpd), greater than double the mixed shortfalls of the Seventies’ crises.
He stated liquefied pure gasoline (LNG) provides had been lowered by about 140 billion cubic metres, in contrast with a shortfall of 75bcm within the aftermath of Ukraine’s invasion by Russia.
At the very least 40 power amenities throughout 9 nations have additionally been severely broken within the battle, the IEA chief stated.
“The worldwide financial system is going through a serious, main menace immediately, and I very a lot hope that this concern shall be resolved as quickly as doable,” Birol stated.
Birol additionally expressed concern that the size of the disaster had beforehand not been absolutely understood, explaining his choice to talk publicly in regards to the state of affairs final week for the primary time.
On Friday, the Paris-based intergovernmental organisation, which earlier this month introduced plans to coordinate the discharge of 400 million barrels of oil from emergency stockpiles, proposed a sequence of measures governments may take to scale back power consumption.
The proposed measures embody facilitating extra distant working and carpooling, and reducing velocity limits on motorways.
“I assumed the depth of the issue was not properly appreciated by the decision-makers world wide,” Birol stated.
The IEA chief stated he was in session with totally different nations about releasing extra strategic oil reserves if wanted, however the “single most essential answer” to the disaster was to unblock the strait, which often carries about one-fifth of world oil and LNG provides.
Oil costs have surged greater than 50 p.c for the reason that begin of the warfare, which started with US-Israeli strikes on February 28, amid Iran’s efficient blockade of the vital waterway.
US President Donald Trump on Saturday issued Iran a 48-hour ultimatum to unblock the strait or face the destruction of its energy vegetation, the deadline for which is because of expire on Monday night in america.
Iran has threatened to fully shut the waterway, which has been transited by a small variety of vessels not aligned with the US or Israel, and launch assaults on power and water infrastructure throughout the area if the US strikes its energy vegetation.
