The global energy system is facing a crisis more severe than the twin oil shocks of the 1970s and the fallout from the Ukraine war, according to International Energy Agency chief Fatih Birol, as escalating conflict around Iran and the closure of the Strait of Hormuz send shockwaves through oil and gas markets worldwide.
A crisis underestimated by world leaders
Fatih Birol has warned that the scale of the disruption caused by the Iran conflict has not been fully understood by policymakers. The combination of direct attacks on energy infrastructure and the near-total disruption of flows through the Strait of Hormuz has created what he described as a “major, major threat” to the global economy.
The strait, one of the world’s most critical energy chokepoints, normally handles around one-fifth of global oil supply. Its closure has rapidly transformed what initially appeared to be a regional conflict into a systemic global energy crisis.
Supply shock exceeds historic oil crises
According to the IEA, global oil supply disruptions have reached levels surpassing those seen during the oil shocks of 1973 and 1979. The world is currently facing a loss of approximately 11 million barrels per day—more than the combined impact of those earlier crises.
Birol emphasised that this level of disruption places the current crisis in a category of its own, exceeding not only the 1970s shocks but also the energy dislocations triggered by Russia’s invasion of Ukraine.
The consequences are already visible across markets, with oil prices surging sharply and volatility spreading across equities, currencies, and commodities.
Strategic reserves offer only temporary relief
In response, the IEA has coordinated the largest release of strategic oil reserves in history, making around 400 million barrels available to the market.
However, Birol has been clear that such measures can only provide short-term stabilisation. Emergency stockpiles are finite, and their release does not address the underlying issue: a structural disruption to supply chains and energy infrastructure across the Middle East.
Restoring production capacity will take time, particularly as at least 40 energy assets across multiple countries have been damaged during the conflict.
Global economic risks intensify
The implications extend far beyond energy markets. Higher oil and gas prices risk feeding into inflation, increasing production costs across industries, and slowing global economic growth. Key sectors such as petrochemicals, fertilisers, and transportation are especially vulnerable.
Asia, heavily dependent on energy flows through Hormuz, is particularly exposed, but Birol stressed that no region will be immune to the fallout.
The crisis also threatens to complicate central bank policy, as inflationary pressures collide with already fragile growth conditions in major economies.
A निर्णing moment for global energy security
Birol has underscored that reopening the Strait of Hormuz is the single most critical step towards stabilising markets. Without it, the world risks entering a prolonged period of elevated energy prices and economic instability.
The current الأزمة serves as a stark reminder of the global economy’s dependence on a handful of strategic transit routes and politically volatile regions. As governments scramble to respond, the coming weeks will determine whether this shock remains contained—or evolves into a sustained global energy crisis with long-lasting consequences.
Newshub Editorial in Global – March 23, 2026
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