The head of the International Energy Agency has sought to ease concerns about a global oil crisis as conflict continues in the Middle East, saying there is “plenty of oil in the market”.
Fatih Birol addressed reporters in Brussels on Friday following a meeting with European Union chief Ursula von der Leyen and EU commissioners.
The US-Israel war on Iran and Tehran’s retaliatory attacks across the Gulf region have driven crude prices up by about a fifth since 27 February, the day before the attacks started.
Birol said “logistical disruption” from the war was “creating challenges for many countries” but stressed there was more than enough oil in the global market.
“There is plenty of oil, we have no oil shortage,” he said. “There is a huge surplus in the market. We are facing a temporary disruption, a logistical disruption.”
While Iran has not officially shut off the Strait of Hormuz, through which a fifth of the world’s crude supplies and a substantial amount of gas run, shipping through the waterway has all but dried up.
US President Donald Trump has pledged to protect ships passing through and promised further action to “reduce pressure on oil”, but prices have remained elevated.
When asked whether the IEA was considering the release of emergency stocks, Birol said “all options are on the table” but that at this stage there were no plans for “collective action”.
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The IEA was created to coordinate responses to major disruptions of supply after the 1973 oil crisis.
Birol acknowledged the current crisis had led to questions in some quarters about whether Europe should once again look at Russia for energy supplies, something he said would be a mistake.
“To look at Russia as an alternative option for getting gas will be economically and, in my view, politically wrong,” he told reporters, describing past over-reliance on Moscow as “one of Europe’s historical mistakes”.
Large quantities of liquified natural gas from the United States, Canada and other countries were expected to hit the market in the next five years, he added.
On meeting growing demand for power and bringing down energy prices, Birol said it was in European countries’ best interest “to make more of their renewable energies – solar, wind and others” and make a “strong comeback” on nuclear power.
