International Energy Agency Executive Director Fatih Birol is warning that the current disruption tied to the closure of the Strait of Hormuz has become one of the gravest energy shocks in modern history. Birol said the oil supply losses now exceed the combined impact of the 1973 and 1979 oil crises, while gas disruptions are nearing double the scale of the losses seen after Russia’s war against Ukraine. His blunt conclusion was unmistakable: the situation is “very severe.” The warning underscores how quickly the conflict around Iran has escalated from a regional military crisis into a global economic threat.

According to Birol’s public remarks, the Hormuz shutdown has removed roughly 11 million barrels of oil per day from global supply, a stunning figure that exceeds the scale of the major oil shocks of the 1970s. He also said natural gas losses have reached about 140 billion cubic meters, magnifying the pressure on countries already struggling with inflation, energy insecurity, and fragile industrial supply chains. The disruption is not limited to crude and gas alone. Fertilizer inputs and petrochemical feedstocks are also being squeezed, raising fears that the shock could spill into food production and consumer prices in the months ahead.

The crisis has been driven by the widening conflict involving Iran, Israel, and the United States, with attacks and counterattacks damaging critical energy infrastructure across the Middle East. As shipping through Hormuz has been choked off, governments and energy producers have scrambled to find workarounds, including pipeline rerouting and unprecedented emergency stockpile releases. The IEA has already coordinated a record 400 million-barrel release from strategic reserves in an effort to calm markets and buy time. Even so, Birol has made clear that reserve drawdowns are only a temporary cushion and that reopening the Strait of Hormuz remains the most important solution.

The broader concern now is that prolonged disruption could trigger second-order economic damage far beyond the oil market itself. Fertilizer shortages, especially from key Gulf producers, threaten to push up agricultural costs and eventually food prices, while industrial sectors dependent on gas and petrochemicals could face sustained strain. For policymakers, the warning from the IEA is a reminder that the energy system remains deeply vulnerable to geopolitical chokepoints and military escalation. What began as a regional conflict is now testing the resilience of the global economy, and Birol’s message leaves little doubt that the world is entering a dangerous period of energy instability.