IEA Declares Current Oil Crisis More Severe Than Past Crises

Fatih Birol, the head of the International Energy Agency (IEA), has stated that the current oil crisis is more serious than those experienced in 1973, 1979, and 2002 combined. This warning comes amid significant disruptions in the Strait of Hormuz, where approximately 20% of the world's oil supply regularly flows.

The IEA has indicated that these disruptions are causing surges in energy prices, which could lead to higher oil and food prices, exacerbating inflation. A recent study from the Organisation for Economic Co-operation and Development (OECD) estimates that the long-term economic impact of COVID-19 could cost leading economies in Europe, America, and East Asia about $135 billion annually over the next decade.

The IEA's member countries have agreed to release strategic reserves to mitigate the crisis, while the ongoing geopolitical tensions involving Israel and Iran further complicate the situation.