IEA Chief Warns Of 'Very Severe' Situation In Middle East, Calls For Reopening Of Strait Of Hormuz

The Executive Director of the International Energy Agency Fatih Birol said on Monday that the global energy situation caused by the conflict in the Middle East is "very severe."

“Let me explain to you how challenging the situation is. Many of us remember the two consecutive oil crises in 1970’s, 1973 and 1979. And at that time, in each of the crisis, the world has lost about 5 million barrels per day, both of them together 10 million barrels per day. And after that, we all know that there was major economic problems around the world, the recessions. And today, only as of today, we lost 11 million barrels per day. So more than two major oil shocks put together,” the International Energy Agency Executive Director said.

Birol told the National Press Club in the Australian capitol Canberra that he thinks the "depth of the problem was not well appreciated by the decisionmakers around the world."

He warned the current energy crisis is more severe than the two oil crisis in 1970’s combined.

Disruptions to oil, gas and other industrial materials will continue to pose serious risks to the global economy, he added.

"The single most important solution to this problem is opening up the Hormuz Strait as things stand now," Birol said.

Birol added that he was consulting with governments in Europe and Asia about the prospect of releasing further stockpiled oil.

There has been no sign of an uprising, nor of an end to the fighting that has shaken the global economy, sent oil prices surging and endangered some of the world's busiest air corridors.

Iran said the Strait of Hormuz, crucial to oil and other exports, would be "completely closed” immediately if the U.S. follows up on President Donald Trump's threat to attack its power plants. Trump late Saturday set a 48-hour deadline to open the strait.