{"id":400773,"date":"2026-03-24T04:30:11","date_gmt":"2026-03-24T04:30:11","guid":{"rendered":"https:\/\/www.europesays.com\/ie\/400773\/"},"modified":"2026-03-24T04:30:11","modified_gmt":"2026-03-24T04:30:11","slug":"shock-to-global-oil-market-roughly-3-times-bigger-than-1970s-crisis","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/ie\/400773\/","title":{"rendered":"Shock to global oil market roughly 3 times bigger than 1970s crisis"},"content":{"rendered":"

On Monday, the 24th day of the U.S. and Israel\u2019s war in Iran, International Energy Agency executive director Fatih Birol said the war is posing a \u201cmajor, major threat\u201d<\/a> to the global economy, and that \u201cno country will be immune\u201d if it continues much longer.<\/p>\n

And the war continuing longer appears likely. Already, Birol said its impact on oil is worse<\/a> than the two oil shocks of the 1970s, combined. The impact on natural gas is worse than when Russia invaded Ukraine, he said.<\/p>\n

Those who were old enough to drive in 1973 \u2014 during the OPEC oil embargo \u2014 or during the Iranian Revolution in 1979 might remember gas shortages and long lines to fill up their tanks.<\/p>\n

\u201cEach of those took about 5 million barrels a day<\/a> of oil supply off of the market,\u201d said Samantha Gross, director of the Energy Security and Climate Initiative at the Brookings Institution.<\/p>\n

But now, with the Strait of Hormuz largely closed, she said the impact is larger.<\/p>\n

\u201cWe’ve lost maybe 15 million barrels a day<\/a>, or 15% of supply,\u201d Gross said. \u201cSo this supply shock is three times bigger than the ones that we saw in the 1970s.\u201d<\/p>\n

This is also not the 1970s.<\/p>\n

\u201cThe United States now is less dependent on oil imports<\/a> than we were 50 years ago,\u201d said Hugh Daigle, a professor at the University of Texas at Austin who studies petroleum.<\/p>\n

Daigle said that\u2019s why gas prices in the U.S. are spiking, but we\u2019re not seeing shortages.<\/a><\/p>\n

\u201cBut countries like Pakistan, India, Thailand, China, Japan \u2014 they are really being hurt by this,\u201d he said.<\/p>\n

That\u2019s because they are more dependent on oil from the Persian Gulf. Many Asian and Western European countries also now rely heavily on liquefied natural gas,<\/a> or LNG, from the region.<\/p>\n

\u201cThis goes back to what happened in 2022 with Russia invading Ukraine,\u201d Daigle said. \u201cWestern Europe said, \u2018hey, we can’t be so dependent on Russian gas anymore.\u2019 And so they started importing a lot more LNG, and now that infrastructure has been damaged.\u201d<\/p>\n

Some of that damage to gas and oil infrastructure could take years to repair.<\/p>\n

Clayton Seigle, senior fellow for energy security at the Center for Strategic and International Studies, said how deep and lasting the global economic damage<\/a> will be depends on how long the war lasts.<\/p>\n

\u201cYou could be looking at a return of a very negative theme that we had from back in the 1970s, which is the so-called stagflation,\u201d he said. \u201cA perfect storm of lower economic activity and higher general prices.\u201d<\/p>\n

That can last for a long time.<\/p>\n

Related Topics<\/p>\n","protected":false},"excerpt":{"rendered":"On Monday, the 24th day of the U.S. and Israel\u2019s war in Iran, International Energy Agency executive director…\n","protected":false},"author":2,"featured_media":400774,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[174],"tags":[79,179,18,181867,19,17,95859,9951,186,168834],"class_list":{"0":"post-400773","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-business","9":"tag-economy","10":"tag-eire","11":"tag-global-crude-oil-prices","12":"tag-ie","13":"tag-ireland","14":"tag-liquefied-natural-gas","15":"tag-oil","16":"tag-stagflation","17":"tag-strait-of-hormuz"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@ie\/116282276149931939","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts\/400773","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/comments?post=400773"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts\/400773\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/media\/400774"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/media?parent=400773"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/categories?post=400773"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/tags?post=400773"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}