IEA warns Middle East oil shock to hit Europe in April

The head of the International Energy Agency (IEA), Fatih Birol, has warned that disruptions to oil supplies from the Middle East will deepen in April and begin to affect Europe.

He said the closure of the Strait of Hormuz and the US-Israeli war against Iran have already removed more than 12 million barrels of oil from the market, with losses in April expected to be double those in March. At the same time, the disruption is not limited to oil, with liquefied natural gas (LNG) supplies also under pressure.

Birol warned that higher inflation and weaker economic growth are likely to follow in several countries.

The greatest strain is on aviation fuel and diesel, already felt in Asia and expected to reach Europe soon. The IEA is therefore considering a further release of strategic reserves following a record intervention by member states.

Birol described the situation as worse than both the oil crises of the 1970s and the Russian gas shortage following the invasion of Ukraine.

(reuters, pir)