The global energy crisis triggered by the war with Iran could worsen sharply in April, according to the head of the International Energy Agency, who warned that the disruption now unfolding may surpass previous oil shocks in both scale and economic impact. The warning adds a darker note to recent market optimism, which had briefly improved after President Donald Trump said U.S. forces could leave Iran within two or three weeks.
That market relief may prove premature. While investors have welcomed any signal that the conflict could begin to wind down, the physical disruption to oil and gas flows is still intensifying. The central problem is that some cargoes that moved through the Strait of Hormuz before the war began were still arriving in March, helping cushion the immediate blow. In April, that buffer is expected to disappear.
The result, according to the IEA, is that the supply loss next month could be roughly twice as severe as the shortfall already felt in March. That would deepen pressure on inflation, increase the risk of weaker growth, and place emerging economies in a particularly exposed position as the shock spreads through energy, transport, and industrial supply chains.
April could be worse because the buffer is ending
IEA Executive Director Fatih Birol said March still benefited from shipments that had already passed through Hormuz before the conflict erupted. Those cargoes continued reaching ports and delivering oil, gas, and other commodities even after the war had begun, softening the first stage of the disruption.
That support is now fading. Birol warned that in April there will be no such backlog left to absorb the shock, meaning the real loss of supply will become much more visible. In his view, the oil shortfall next month will be twice as large as the one seen in March, and the wider impact will extend beyond crude into liquefied natural gas and other vital energy linked inputs.
That matters because energy disruptions rarely stay contained within one market. Higher oil and gas costs tend to work their way into transport, manufacturing, heating, and food production, making the inflation effect broader and more persistent than the initial move in fuel prices alone might suggest.
The agency sees a shock bigger than past crises
Birol described the current upheaval as the worst energy crisis in history, arguing that the scale of supply loss now exceeds some of the most notorious oil shocks of the modern era. He compared the current disruption with the crises of 1973 and 1979, when the world lost about 5 million barrels of oil per day in each episode, events that contributed to recession in many countries.
By contrast, he said the current crisis has already removed 12 million barrels per day from the market, more than the combined loss of those two earlier shocks. He also argued that the gas volumes now being lost because of the conflict and the blockade of Hormuz exceed the disruption caused when Russian gas supplies were hit after the full scale invasion of Ukraine in 2022.
That comparison is important because it suggests the present crisis is not merely another episode of elevated oil prices. In the IEA’s view, it is a broader supply shock involving crude, gas, and several industrial commodities at once, raising the risk of more severe strain across global trade and production networks.
The disruption reaches beyond oil and gas
One reason the IEA sees the crisis as especially dangerous is that the damage is spreading across multiple layers of the global economy. Birol said the problem is not limited to lost crude barrels. Petrochemicals, fertilizers, sulfur, and other essential materials are also being disrupted, threatening supply chains well beyond the energy sector itself.
That broader impact could be particularly severe for countries already vulnerable to imported energy costs. Birol said the crisis is likely to feed into inflation and weaken economic growth in many places, especially in emerging economies. He even warned that some countries may soon face energy rationing if the supply shock intensifies and alternative channels fail to compensate quickly enough.
Such a scenario would mark a shift from a market crisis to a more direct economic emergency. Once energy shortages begin forcing rationing or widespread industrial adjustment, the damage moves beyond price pressure and into the real economy in a much more disruptive way.
Strategic reserves can ease pressure, not solve it
The IEA is now considering whether to recommend another release from strategic oil reserves as the conflict drags on. Earlier this month, the agency’s 32 member countries agreed to release a record 400 million barrels from emergency stockpiles to soften part of the disruption caused by the war. Birol said the market is being assessed constantly and that another recommendation remains possible if conditions deteriorate further.
Even so, he was careful to say that reserve releases are only a temporary relief measure. In his words, such action may reduce the pain, but it cannot cure the problem. The main challenges at the moment are already shifting toward products such as diesel and jet fuel, with pressure first appearing in Asia and expected to spread into Europe in April or early May.
That is why the IEA’s message remains uncompromising. Emergency stocks can buy time, but they cannot restore normality. The only true solution, Birol said, is reopening the Strait of Hormuz. Until that happens, the world may be facing not just a period of high prices, but the most severe energy disruption modern markets have ever had to absorb.
