Business

The IEA calls for driving restrictions and air travel restrictions to reduce oil demand

The International Energy Agency has urged member countries to take “emergency measures” to curb oil demand in the wake of Russia’s invasion of Ukraine, including driving bans, lower speed limits and restrictions on air travel.

Fatih Birol, head of the energy regulator, warned on Friday that such steps may be necessary because “oil markets are in an emergency situation. . . and it can get worse.”

As much as 2.5 million barrels a day of Russian oil exports could be halted from next month due to the impact of the war and the consumer boycott on Russian crude, he said. Russia is one of the largest oil producers in the world.

The IEA has proposed 10 measures reduce oil demand by 2.7 mb/d over the next four months, which would help offset potential losses from the Russian market.

“As a result of Russia’s appalling aggression against Ukraine, the world may be facing the biggest oil supply shock in decades,” Birol said.

He urged IEA member countries – which include many of the world’s biggest energy consumers such as the US, Japan and Germany – to curb demand now “to avoid the risk of a crippling oil crisis”.

Measures include reducing motorway speed limits by 10 km/h, which would save 430,000 b/d, reducing business travel by air and using trains instead of planes where possible.

Working from home three days a week would also help reduce oil demand and make public transport cheaper or even free. Many of the proposals would restrict motoring, including banning private cars from cities on Sundays and restricting private car access to streets in major cities.

The IEA was formed in the 1970s to help oil-consuming countries respond to the 1973 oil crisis and monitor global energy markets. But seldom has the panel had to resort to the dramatic demand-cutting steps it outlined on Friday.

The price of Brent crude, the international benchmark, rose to $139 a barrel following the Russian invasion of Ukraine amid supply concerns. It was trading at $107 a barrel on Friday.

Barbara Pompili, France’s green transition minister, said the IEA plan to reduce consumption offers “interesting ideas” that could be a roadmap for countries to reduce their oil dependency.

“France and all European countries need to get out of their dependence on fossil fuels as soon as possible. It’s an absolute necessity for the climate, but also for energy sovereignty,” she said.

The IEA will present the recommendations to energy ministers next week as part of its response plan to the current energy crisis.

Birol warned that the combination of the loss of Russian exports, increased demand during the summer tourist season and low inventories could mean the oil market could get even tighter than it is now.

“The reason we produced this report is that the oil markets are in an emergency situation, and not only that, it could get worse,” he said.

https://www.ft.com/content/a5df06cf-a11c-42bd-81b5-5e30ec3a64aa The IEA calls for driving restrictions and air travel restrictions to reduce oil demand

Adam Bradshaw

TheHitc is an automatic aggregator of the all world’s media. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, all materials to their authors. If you are the owner of the content and do not want us to publish your materials, please contact us by email – admin@thehitc.com. The content will be deleted within 24 hours.

Related Articles

Back to top button