Russias Oil and Gas Demand Surges Amid Tensions with Iran

International Energy Agency Sounds Alarm on Russian Energy Reliance

The International Energy Agency (IEA) has warned against a potential return to reliance on Russian energy products due to the ongoing conflict in Iran and its impact on global oil supplies. The IEA’s Executive Director, Fatih Birol, stated that the current crisis in the Middle East has led to questions about whether to rely on Russia for gas supplies.

The war in Iran has resulted in a significant increase in demand for Russian energy resources, according to Kremlin spokesman Dmitry Peskov. He noted that Russia remains a reliable supplier of oil and gas, including pipeline gas and liquefied natural gas. However, Birol cautioned that relying on Russia would be economically and politically wrong.

Birol stated that one of Europe’s historical mistakes was overreliance on energy sources from a single country, specifically Russia. He claimed there is “logistical disruption” from the war, but noted that there is “plenty of oil” in the global market.

Meanwhile, Qatar’s Energy Minister Saad al-Kaabi has predicted that all Gulf energy producers will shut down exports within weeks if the Iran conflict continues and drives oil prices to $150 a barrel. Al-Kaabi stated that this would lead to higher energy prices worldwide, shortages of products, and a chain reaction of factories unable to supply.

The IEA’s warning comes as the US Treasury has issued a 30-day waiver allowing India to buy Russian oil currently stuck at sea. The conflict in Iran has left the Strait of Hormuz, a critical shipping passage, all but shut, with countries around the world scrambling for alternative energy sources.

As of Friday, benchmark US crude surged 4.1 percent to $84.36 per barrel, while Brent crude, the international standard, rose to $85.29 per barrel. The IEA’s warning highlights the potential risks and consequences of relying on Russian energy supplies during this critical time.

Source: Al Jazeera