World faces biggest energy security threat in history: IEA chief

The world is facing the biggest energy security crisis in history, the head of the International Energy Agency (IEA) said in an interview with CNBC in Singapore on Thursday (April 23). Fatih Birol said the world is facing the biggest energy security threat in history. Currently, 13 million barrels of oil are disappearing from the global market every day, causing major disruptions to the supply of vital goods.
He added that the situation has been further complicated by the Iran war and the closure of the Strait of Hormuz. The crisis could lead to an increase in the use of nuclear power, renewable energy, solar power, wind power and electric vehicles. However, coal use could also increase in some countries, especially in major Asian economies.
Before the war, about 20 million barrels of oil and oil products were transported through the Strait of Hormuz every day. The waterway is currently under a virtual “double blockade” due to sanctions imposed by both Iran and the United States. The IEA has warned that a closure of the route could slow global economic growth, fuel inflation and lead to fuel rationing.
Warning of a looming jet fuel shortage in Europe, Birol said that about 75 percent of Europe’s jet fuel comes from Middle Eastern refineries, whose production has now dropped to almost zero. He said Europe is now trying to source jet fuel from the United States and Nigeria. If additional imports are not secured, Europe will be in trouble.
Birol also expressed hope that the Strait of Hormuz will be opened and exports from there will resume. But he added that if necessary, steps such as reducing air traffic to Europe may have to be taken. The 32-member IEA decided in March to release 400 million barrels of oil from emergency reserves to ease the impact of the global supply crisis. But Birol said this would only ease the pain, not solve the problem. The real solution is to open the Strait of Hormuz.