The heads of the International Monetary Fund, World Bank and International Energy Agency have warned of risks to fuel security during peak-demand summer months if oil shipping through the Strait of Hormuz does not return to normal.
“Global oil inventories are being drawn down at a record pace in response to the major loss of supply through the Strait of Hormuz,” the heads of the agencies said in a joint statement on Friday.
“If shipping flows do not return to normal, continued rapid depletion of global oil inventories ahead of peak summer oil demand in the Northern Hemisphere would present increasing risks for fuel security, market conditions, and broader economic resilience.”
The US-Israel war with Iran has engulfed the Middle East in conflict, with Tehran’s retaliatory attacks targeting Washington’s allies in the Gulf and virtually blocking the key waterway, through which a fifth of global energy supplies normally pass.
In Friday’s joint statement, heads of the IMF, World Bank, and IEA highlighted that the surge in energy and fertiliser prices due to the war was having a disproportionate effect on lower-income countries.
“Higher fertiliser prices are of particular concern as many countries enter the planting season,” they said.
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