The world is facing an energy crunch more severe than anything seen in decades. The numbers tell a stark story. According to International Energy Agency chief Fatih Birol, the fallout from the ongoing conflict involving Iran has created a perfect storm that surpasses the twin oil shocks of the 1970s and the gas shortages triggered by Russia’s invasion of Ukraine combined.
Speaking on Monday at Australia’s National Press Club in Canberra, Birol was blunt. “This crisis, as things stand, is now two oil crises and one gas crash put all together,” he told reporters. The seasoned energy expert rarely delivers warnings with such force, but he said he felt compelled to speak publicly because too many decision-makers still fail to grasp the full scale of the threat.
The core of the problem lies in the effective closure of the Strait of Hormuz. This narrow waterway carries roughly one-fifth of the planet’s oil and liquefied natural gas supplies. Since US-Israeli strikes began on February 28, attacks on energy infrastructure and Iran’s blockade have cut global oil supplies by about 11 million barrels per day. That figure is more than double the combined shortfalls from the 1973 and 1979 shocks that once plunged the global economy into turmoil.
The impact on gas is equally severe. Liquefied natural gas deliveries have fallen by roughly 140 billion cubic metres, nearly twice the shortfall that followed Russia’s 2022 invasion of Ukraine. Beyond the volume losses, the physical damage is extensive: at least 40 energy facilities across nine countries have suffered serious harm.
Oil prices have surged more than 50 percent since the conflict started. For families at the pump, for industries managing rising costs, and for governments already battling inflation, the consequences hit hard and fast.
Birol delivered his message with clear urgency. The global economy now faces “a major, major threat,” he said, and he expressed hope that leaders will act swiftly to resolve the situation. In his view, the single most important step is to reopen the strait. Everything else, from releasing emergency stockpiles to promoting remote work, carpooling, and reduced highway speed limits, plays a supporting role.
The IEA has already moved forward with action. Earlier this month the agency announced plans to coordinate the release of 400 million barrels from strategic reserves around the world. Birol confirmed that discussions continue with governments about tapping additional reserves if needed. Yet he stressed that temporary measures cannot address the fundamental choke point in the Gulf.
This moment carries echoes of history. The 1970s oil shocks reshaped economies, transportation, and foreign policy. They showed how quickly energy disruptions can spread panic. Today’s crisis builds on the lingering effects of the Ukraine war and arrives when the global economy is already stretched by trade tensions, climate challenges, and uneven post-pandemic recovery.
Birol’s public statement last week marked a shift. Until then the Paris-based agency had largely worked behind the scenes. Now the warning is unmistakable: this is not a routine supply disruption. It is a test of how fast the international community can respond when vital sea lanes become battlegrounds.
With US President Donald Trump’s 48-hour ultimatum to Iran approaching its deadline, the tension is palpable. Iran has promised to maintain the blockade and retaliate forcefully against any strikes on its energy or water infrastructure. Only a small number of vessels, those not aligned with Washington or Tel Aviv, have managed to pass through. The overall flow remains a fraction of normal levels.
For now the world waits. Fatih Birol’s assessment is not alarmist exaggeration; it is a sober evaluation from the person tasked with monitoring these flows every day. The hope he voiced in Canberra, that the issue resolves “as soon as possible,” is shared by millions. When energy markets tighten this severely, the consequences do not remain regional. They reach households, businesses, and economies everywhere that depend on keeping the lights on and the engines running.
The coming days will reveal whether diplomacy, pressure, or decisive action can restore passage through the Strait of Hormuz. Until then the IEA’s warning stands firm: this energy crisis is not merely larger than the 1970s shocks. It is the kind that could reshape global rules for years to come.
