The global energy system has been pushed to the very edge of its operational limits by the Iran war, the head of the International Energy Agency has warned. Fatih Birol, speaking in Canberra, said the combination of supply losses, infrastructure damage, and transit disruptions had strained the system’s ability to respond in ways that had never been seen before. He described the overall crisis as equivalent to the combined force of the 1970s twin oil shocks and the Ukraine gas disruption.
The conflict began February 28 with US and Israeli strikes on Iran and has since led to the closure of the Strait of Hormuz, the loss of 11 million barrels of oil per day, and gas losses of 140 billion cubic metres. At least 40 Gulf energy facilities have been severely damaged, leaving global supply chains with far less redundancy than normal. These losses are more than double those of the combined 1970s oil crises and significantly exceed the gas losses of the Ukraine conflict.
The IEA responded on March 11 with the largest emergency reserve release in its history — 400 million barrels of oil from strategic stocks — while calling for demand-reducing policies. Birol confirmed further releases were under active consideration and that consultations with governments in Europe, Asia, and North America were ongoing. He said the agency would continue to monitor conditions closely and act without hesitation if the situation required it.
The Hormuz strait, through which about 20 percent of global oil flows, remains closed to commercial shipping. The Asia-Pacific region has been most severely affected, while European markets have also seen diesel and jet fuel supplies tighten. Birol said the disruption had extended beyond oil and gas to petrochemicals, fertilizers, sulfur, and helium, with cascading consequences for agriculture and industry.
Trump’s 48-hour ultimatum to Iran to reopen the strait expired without result, and Tehran threatened retaliatory strikes on US and allied energy and infrastructure. Birol met with Australian Prime Minister Anthony Albanese and called for maximum international coordination. He warned that with the global energy system already at its limits, any further supply disruption could trigger consequences that would be extremely difficult to manage.
energy system limits, IEA operational capacity