The IEA presents 10 concrete measures to reduce global oil consumption, addressing the Middle East conflict's impact on supply and market volatility amidst the current oil crisis.
The IEA proposes 10 key measures to curb oil consumption amidst the ongoing oil crisis
The war in the Middle East has escalated into an oil war. According to the International Energy Agency (IEA), events of recent weeks have led to the largest supply disruption in the history of the global oil market. The Strait of Hormuz, a vital transit point handling approximately 20% of the world’s black gold consumption, is central to the oil crisis.
Typically, about 20 million barrels per day of crude oil and petroleum products transit through the Strait. But with maritime traffic significantly reduced, the bottleneck has pushed crude oil prices over 100 dollars per barrel: diesel, jet fuel, and LPG are all increasing substantially.
The IEA’s response: not just emergency reserves
To stabilize markets, IEA member countries agreed on March 11 to release 400 million barrels from emergency reserves, the largest drawdown in the Agency’s history. However, IEA Executive Director Fatih Birol warned that supply-side measures alone cannot offset the magnitude of the disruption. It is therefore necessary to intervene on demand to reduce economic pressure on consumers and ensure energy security.
“In the absence of a swift resolution, the impact on energy markets and economies is set to become increasingly severe,” stated Birol, adding: “Today’s report provides a series of immediate and concrete demand-side measures that can be adopted by governments, businesses, and households to protect consumers from the impacts of this crisis. It draws on decades of IEA experience in this field and highlights measures that have proven effective in practice across various contexts.”
Ten immediate measures to reduce consumption during the oil crisis
In the new report, the Agency has developed 10 concrete actions that can be implemented quickly. Since road transport accounts for about 45% of global oil demand, most recommendations focus on this sector, but they also touch upon industry and domestic energy use.
- Work from home: Where possible, smart working reduces fuel consumption related to home-to-work commutes.
- Reduce speed limits: Lower highway speeds by at least 10 kilometers per hour to decrease fuel consumption for both passenger and freight vehicles.
- Promote public transport: Encourage citizens to prefer public transportation over private cars.
- Alternate vehicle access: Limit private vehicle access in large cities, alternating with the use of public transport.
- Car sharing: Promote carpooling to reduce the number of vehicles on the road.
- Efficient driving: Adopt driving practices that optimize fuel consumption.
- Freight transport efficiency: Improve the management of transport and delivery operations.
- Reduce air travel: Limit flights when valid alternatives, such as trains, exist to reduce demand for jet fuel.
- Shift LPG use: Allocate liquefied petroleum gas (LPG) to essential applications like cooking, reducing its use in the transport sector and encouraging alternative, clean cooking solutions.
- Industrial conversion and maintenance: In industrial plants, switch from LPG to alternative raw materials such as naphtha and implement short-term efficiency and maintenance measures.
The role of governments
According to the IEA report, governments must also set a good example. How? It is crucial that economic support for citizens is not generalized, but rather timely and focused on those who need it most. Experience from past crises shows that targeted subsidies are more effective and fiscally sustainable than widespread ones.
