Iran war energy crisis equal to 70s twin oil shocks and Ukraine invasion fallout, says IEA chief | First Thing

The head of the International Energy Agency (IEA) stated that a war in Iran and the closure of the Strait of Hormuz would create an energy crisis equivalent to the combined impact of the 1970s oil shocks and the Ukraine invasion fallout. This assessment suggests a potentially severe disruption to global energy markets. The Iranian government is threatening to lay mines across the entire Gulf if its coasts are attacked. Former CIA chief Leon Panetta criticized Donald Trump's approach to Iran, calling it a message of weakness. The situation is ongoing, and further developments are being monitored.

IEA Executive Director Fatih Birol stated that the current energy crisis, triggered by the US-Israel war on Iran, poses a "major threat" to the global economy. Speaking in Australia, Birol said the crisis surpasses the combined impact of the 1970s oil shocks and the energy fallout from the Ukraine war. He noted a significant reduction in global oil and LNG supplies due to the conflict, with the Strait of Hormuz closure and attacks on energy facilities causing substantial damage. The IEA has proposed measures for governments to reduce energy consumption and coordinated the release of oil from emergency stockpiles. Birol expressed concern that the scale of the crisis had not been fully understood.

The head of the International Energy Agency (IEA) warned on Monday that a prolonged Middle East war could trigger an energy crisis exceeding the combined impact of the 1970s oil shocks and the Russia-Ukraine conflict. Fatih Birol stated the world is losing more oil daily than during those previous crises, threatening global economic stability. The warning comes as the conflict continues into its fourth week, with Israel launching fresh strikes. US President Donald Trump issued a 48-hour ultimatum to Iran, demanding the reopening of the Strait of Hormuz by Monday evening or face military action. The IEA fears that if the conflict escalates, no country will be immune to the resulting economic consequences.

Following "good and productive conversations" with Tehran, former President Donald Trump announced on Monday that he has ordered the US military to postpone strikes against Iranian power plants and energy infrastructure for five days. This decision comes after Trump issued a 48-hour ultimatum to Iran on Saturday, demanding the reopening of the Strait of Hormuz or face obliteration of its power plants. Iran threatened to close the strait, a critical oil transit point, and retaliate against energy facilities in Israel and Gulf countries. The Islamic Revolutionary Guard Corps warned that if the US attacked, they would target power plants supplying US bases and economic infrastructure where Americans have shares. Iran also threatened to mine Gulf shipping routes if its southern coast was attacked.

Facing a Monday deadline from US President Trump to end its partial blockade of the Strait of Hormuz, Iran is threatened with the obliteration of its power plants. Trump's ultimatum, issued due to rising fuel prices after Iran's retaliatory actions in the Gulf, demands the country open the crucial waterway through which a significant portion of the world's oil flows. In response, Iran's military command has vowed to strike power plants and infrastructure in Israel and regional countries hosting US bases or companies with American shareholders if Trump follows through with his threat. The situation unfolds amidst escalating tensions, with Israel signaling a potential ground campaign into Lebanon to combat Hezbollah, further complicating the geopolitical landscape.

In March 2026, Israel announced it would escalate its military campaign against Hezbollah in Lebanon. The intensified operations will target bridges over the Litani River and involve accelerated demolitions in border areas. Israeli officials indicated that this campaign is expected to be prolonged. These actions are reportedly linked to the ongoing war on Iran. The stated reason for the escalation is to counter Hezbollah's activities. The location of the increased military activity is primarily focused on southern Lebanon, specifically near the Litani River and border regions.

In March 2026, during the fourth week of the US-Israeli war on Iran, the Trump administration is sending contradictory messages regarding its strategy. Despite weeks of air strikes and the killing of Iranian leaders, Iran has retaliated against Israel and Gulf countries and imposed a blockade on the Strait of Hormuz, causing oil prices to surge. This has led to pressure on Trump, prompting him to allow the sale of sanctioned Russian oil and pressure allies to police the strait. Trump has threatened to "obliterate" Iranian power plants if the Strait of Hormuz is not reopened, but also stated the US is "winding down" military operations. Analysts suggest Trump initiated the war without a clear objective and misjudged Iran's response, leading to an expanded conflict across the Middle East.

The Litani River, a 90-mile waterway in Lebanon, is becoming a focal point in the ongoing conflict between Israel and Hezbollah. Israel's renewed offensive in Lebanon has brought the river's strategic importance back into focus. The river's location and potential use as a natural boundary could determine the extent and spread of the fighting. Control and access to the Litani River have historically been significant factors in regional conflicts, and this current escalation is no different. The river's fate could significantly influence the future trajectory of the Israel-Hezbollah war.

Amidst escalating tensions in the Middle East, the US has temporarily eased sanctions on Iranian oil already at sea, aiming to stabilize rising oil prices caused by the ongoing US-Israeli conflict with Iran. The license permits the purchase of Iranian oil loaded onto vessels before 5:01 am GMT on Friday, with the exemption lasting until April 19th. This move coincides with reports of Israeli attacks on Tehran and Hezbollah targets in Beirut, as well as Iranian missile fire towards a US-UK military base in Diego Garcia. Meanwhile, Donald Trump indicated he is considering "winding down" the war with Iran, suggesting other nations should take responsibility for policing the Strait of Hormuz.

In March 2026, President Trump sent mixed signals regarding the ongoing U.S. and Israeli war against Iran. While suggesting he was considering winding down the conflict, his administration confirmed the deployment of additional troops to the Middle East. Simultaneously, the U.S. eased sanctions on some Iranian oil exports, a move intended to lessen the economic impact on global energy markets. These actions, taken within a few hours, created confusion about the administration's strategy and long-term goals for the war, which was in its fourth week. Critics suggest the contradictory messages highlight a lack of clear direction in the conflict.