The US could see fuel shortages this summer once people start taking their vacations — and Europe could take a particular hit from the lack of supply, the head of the International Energy Agency has warned.
“When the main holiday season starts in Europe and the US, fuel demand will rise,” Fatih Birol told Der Spiegel. “Then we could see shortages — for example, in diesel, petrol or kerosene, particularly in Europe.”
Birol also told the German newspaper that the energy crisis now underway will be more severe and longer-lasting than the oil price shocks of the 1970s, given it’s applying pressure on three fronts.
“Back then it was just about oil,” he said in the interview published Tuesday. “Now we have an oil crisis, a gas crisis and an electricity crisis simultaneously.”
Oil prices spiked in 1973 and 1979 as the Yom Kippur War and the Iranian Revolution interrupted Middle Eastern crude exports. Geopolitical events have hit the market again in 2022, as western nations impose sanctions on Russia over its invasion of Ukraine.
Right now, oil, gas, and electricity prices are soaring on both sides of the Atlantic, leading to a cost-of-living crisis.
Fuel shortages are more likely to occur in the summer because people drive more as they take getaways. This will likely push prices even higher in the coming months, Birol suggested.
Gas prices have hit record levels in recent weeks, with a gallon costing $4.62 on average on Memorial Day, according to data from the American Automobile Association.
Meanwhile, the average price of US electricity has increased 6.1% over the past year, data from the Environmental Investigation Agency showed.
Crude oil was trading around two-month highs on Tuesday after the EU agreed to ban most Russian oil imports and China eased its COVID-19 restrictions, leading to hopes of a revival in demand from the economic powerhouse.