Work from home and drive slowly, says international agency on energy crisis

Governments around the world should consider drastic measures to reduce oil demand in the face of an emerging global energy crisis caused by Russia’s invasion of Ukraine, the International Energy Agency warned on Friday.

The energy watchdog detailed a 10-point emergency plan that includes lowering highway speed limits by at least 10 kilometers per hour, working from home up to three days a week whenever possible, and car-free Sundays on the roads. cities.

The recommendations for advanced economies such as the United States and the European Union would aim to offset the feared loss of nearly a third of Russia’s oil production due to sanctions imposed on Moscow.

Other measures in the emergency plan include increasing car-sharing, using high-speed and night trains instead of planes, avoiding business air travel when possible, and encouraging walking, cycling and public transport.

If fully implemented, the measures would reduce world oil demand by 2.7 million barrels a day in four months — equal to the oil consumed by all cars in China, the IEA said. And the impact would be greater if emerging economies like India and China adopted them partially or fully.

However, the emergency measures would halt or even slow down a world economy that remains largely addicted to fossil fuels, especially for transportation. The IEA is suggesting that headaches would be better than the alternative.

“As a result of Russia’s appalling aggression against Ukraine, the world could be facing its biggest oil supply shock in decades, with huge implications for our economies and societies,” IEA Executive Director Fatih Birol said in a statement.

The proposals reflect recognition that the world has few realistic options to quickly replace oil supplies from Russia, the world’s second-largest oil producer by 2021.

OPEC has signaled it is in no hurry to ramp up production and the release of emergency oil stockpiles has done little to assuage shortages fears.

“The United States and other IEA countries now realize that the potential loss of Russian oil exports constitutes a larger supply shock than strategic stock draws or accelerated production increases from OPEC+ can resolve,” said Bob McNally. , president of consultancy Rapidan Energy.

The Russia-Ukraine crisis sent oil prices soaring last month, pushing US gasoline prices to record levels.

While oil prices have retreated from their recent highs, crude surged back above $100 a barrel on Thursday on renewed concerns about the impact on Russian energy supplies.