Middle East energy output recovery may take 2 years: Birol

Fatih Birol, Chief of the International Energy Agency (IEA)

Fatih Birol, Chief of the International Energy Agency (IEA), said a recovery from the drop in Middle East energy output caused by the ongoing conflict could take about two years, noting the timeline will vary from country to another.

In an interview with Neue Zuercher Zeitung, Birol said markets are underestimating the impact of a prolonged closure of the Strait of Hormuz. He added that oil and gas shipments already en route before the war have now arrived, helping to cushion supply shortages.

“But no new tankers were loaded in March. There were no new deliveries of oil, gas or fuels to Asian markets. This gap is now becoming apparent. If the Strait of Hormuz is not reopened, we must prepare for significantly higher energy prices,” he said.

Asked whether the IEA would conduct another release of emergency oil reserves, Birol said it stands ready to act swiftly and decisively.

“We’re not there yet, but it’s definitely under consideration,” Birol added.