The Iran war and the global energy crisis it has triggered will be recorded by history as a turning point in global energy policy, according to Fatih Birol, the head of the International Energy Agency. Speaking in Canberra, the IEA chief said the crisis — equivalent to the combined force of the 1970s twin oil shocks and the Ukraine gas emergency — had demonstrated fundamental vulnerabilities in the world’s energy systems that could no longer be ignored. He called on governments to use the crisis as a catalyst for building more resilient and diversified energy infrastructure.
The conflict began with US and Israeli strikes on Iran on February 28 and rapidly escalated, leading to the closure of the Strait of Hormuz and widespread damage to Gulf energy facilities. Oil losses from the conflict have reached 11 million barrels per day, while gas losses total 140 billion cubic metres. These figures are unprecedented and have triggered the largest emergency reserve release in the IEA’s history — 400 million barrels deployed on March 11.
Birol said the crisis had exposed critical dependencies on single supply corridors, particularly the Hormuz strait, which carries about 20 percent of global oil supply. At least 40 Gulf energy assets have been severely damaged, making rapid supply restoration impossible even if hostilities end. He identified reopening the strait as the most urgent priority but stressed that the longer-term lesson was the need for greater supply diversification.
The IEA chief called on governments to implement demand-reduction measures including expanded remote work, lower motorway speeds, and fewer commercial flights. He confirmed further reserve releases were under consideration and that the IEA was in active consultation with governments across three continents. Birol said the agency stood ready to use every tool available to reduce the crisis’s economic impact.
Iran threatened retaliatory strikes on US and allied energy and water infrastructure after Trump’s 48-hour ultimatum expired. Birol met with Australian Prime Minister Anthony Albanese and emphasized that no country could protect itself from the consequences of a prolonged crisis through national action alone. He concluded that the world’s response to this crisis would determine whether global energy systems emerged stronger or remained equally vulnerable to future shocks.