Europe could face a shortage of energy and fuel as soon as next month without a reopening of the Strait of Hormuz, Shell’s chief executive has said. Wael Sawan warned that the crisis, now in its fourth week, had already affected supplies of jet fuel, with diesel and petrol likely to come under pressure next.
Speaking at an oil industry conference in Texas, Sawan said: “South Asia was first to get that brunt. That’s moved to south-east Asia, north-east Asia and then more so into Europe as we get into April.” He noted that jet fuel prices have doubled since the start of the conflict, and diesel could be next, followed by petrol as the summer driving season begins in the US and Europe.
Germany’s economy minister, Katherina Reiche, echoed the warning, telling the same conference that energy supply scarcity could occur in late April or May if the conflict continued. She added that Germany’s decision to phase out nuclear energy was a huge mistake and that greater imports of gas via super-chilled tankers from overseas would be important.
The boss of BlackRock, Larry Fink, warned that prolonged global economic recession could result if oil hits $150 a barrel. In an interview with the BBC, Fink outlined two scenarios: one where oil returns to pre-crisis levels of about $70 a barrel, and another where prices reach record highs, leading to “a probably stark and steep recession”.
A British government spokesperson said: “The UK has diverse and resilient energy supply. We continue to work with partners on the international situation.”
