The head of the International Energy Agency intensified his apocalyptic warning about the global energy crisis, stating early Monday that the US-Israel war with Iran has sparked a shock far greater than the twin oil crises of the 1970s and the turmoil from the war in Ukraine combined.
US-Israeli Operation Epic Fury has entered its fourth week, and emerging from the fog of war is the understanding that 44 energy assets across the Gulf region have been severely or very severely damaged by either U.S. and allied forces or by Iranian forces, according to IEA Executive Director Fatih Birol, who spoke at a media event in Australia on Monday.
“This crisis, as things stand, is now two oil crises and one gas crash put all together,” Birol warned at the National Press Club of Australia in Canberra.
So far, the conflict has removed 11 million barrels of oil per day from global supply, which is more than the two prior oil shocks combined.
There are concerns that repairs to QatarEnergy’s damaged LNG facility could take up to five years, while the disruption to energy flows has sparked a fuel crisis across Asia and is set to affect fertilizer and food supplies, as well as helium, potentially jeopardizing AI chip production.
“The global economy is facing a major, major threat today, and I very much hope that this issue will be resolved as soon as possible,” Birol said.
As of 0710 ET, Brent crude futures plunged 11% on President Trump’s Truth Social desesclation comments – a sign the administration needs an offramp to avoid a further energy crisis globally, but more importantly, one at home with fuel prices at the pump exploding higher.
Overnight, President Trump gave Iran a 48-hour ultimatum to reopen the Hormuz chokepoint or face a bombing campaign targeting Iran’s power plants.
There were reports overnight that the Trump administration was preparing a diplomatic off-ramp plan, but Iran says the expanding war has effectively shut the door.
Betting website Polymarket shows that ten new wallets are betting $160,000 on a U.S.-Iran ceasefire by the end of March.
“Almost no history, all created around the same time. Potential payout: over $1,000,000,” the Polymarket History account wrote on X.
On Friday, Birol told the Financial Times in an exclusive interview that the world is severely underestimating the scale of the Gulf energy shock and that it may take at least six months to restore disrupted oil and gas flows.