The conflict between Iran, the United States and Israel is creating the worst energy crisis the world has ever faced, the head of the International Energy Agency (IEA) said on Tuesday.
The agency’s chief, speaking as oil markets remained on edge ahead of a Wednesday ceasefire expiry, described the current disruption as larger in scale than the 1973 Arab oil embargo and the oil shocks of the late 1970s. Brent crude has swung sharply in recent weeks, with prices oscillating between the high $80s and mid-$90s per barrel as traders priced in both blockade and diplomatic outcomes.
The characterisation is a notable escalation of language from the IEA, which in late March warned of the “worst energy crisis in decades” and earlier this month warned Europe could run out of jet fuel within six weeks. The IEA, IMF and World Bank also issued a joint statement warning that poorer nations face the brunt of fuel and fertiliser disruption.
For Sri Lanka, the crisis has translated into diesel premiums reportedly reaching roughly $48–50 per barrel above pre-war levels, compared with around $3 before the conflict. The Ceylon Petroleum Corporation has confirmed diesel shipments above $286 per barrel on recent cargoes, and fertiliser costs have jumped to $800 per tonne heading into the Yala season.
US President Donald Trump has said he considers the ceasefire with Iran to end on Wednesday evening Washington time and has refused to lift the Hormuz blockade until a deal is reached. The IEA assessment suggests that further disruption through Wednesday could push global energy markets into uncharted territory.
