- Almost complete closure of the Strait of Hormuz has created a global energy crisis
- Countries around the world are struggling to cope with rising prices
- Methods of reducing demand vary and include: fuel rationing, working from home and avoiding air travel.
With 20% of the world’s oil unable to pass through the Strait of Hormuz, crude oil prices reaching $100 (€86) a barrel and 400 million barrels of emergency oil reserves already in the market, countries around the world are struggling to find ways to reduce energy demand.
The International Energy Agency (IEA) called it “the largest supply disruption in the history of the global oil market” and outlined several ways countries could use less. But each country has its own energy and transportation infrastructure and challenges, and those that have already worked are doing so in many different ways. Action is yet to be taken on others.
The IEA says road transport accounts for about 45% of global oil demand, so it’s no surprise that many countries are looking to make cuts there.
Fuel rationing a popular option
In Sri LankaPrivate motorists can get only 15 liters of petrol per week through the QR code-based system. Elsewhere in Asia, a third of petrol pumps have been closed cambodia, And myanmar The government has introduced an “odd-even” rationing system based on vehicle registration number. This means that plates with odd numbers can buy fuel one day, plates with even numbers can buy fuel the next day. In new zealandThe government is considering reintroducing “car-free days” in which motorists designate a day of the week on which they will not be allowed to drive.
China It is taking a slightly different approach to planned fuel price increases after a 20% increase in prices at the pump since the start of the war.
slovenia Earlier this week it became the first EU member state to ration fuel, with a 50-litre limit per week for private drivers, while a 200-litre limit is in place for businesses and farmers. thought slovakia Despite curbs on diesel hoarding, Slovenia remains isolated from Europe.
The EU and Germany have been slow to react to the crisis
The International Road Transport Union (IRU) has called on the group to act quickly.
“If diesel supplies are disrupted, the impact will be immediately felt across the EU’s logistics network, slowing supply chains and affecting the delivery of goods to businesses, shops and homes,” said Umberto De Prieto, IRU Secretary General.
“Coordinated EU action is essential to stabilize fuel markets, avoid fragmented national responses and ensure that logistics chains continue to function.”
Since the EU is reluctant to find a unified position, each country must make its own decisions. With petrol and diesel prices at €2 ($2.31) and above per litre, an 18% increase in two weeks, Germany Feeling a prick. A bill has been proposed that would allow petrol stations to raise prices only once a day, but it has been blocked because it would require changes to competition law. Economy Minister Catharina Reich said demands for a fuel price cap, rebates or a windfall tax were being considered, but they should be weighed against costs and benefits.
Despite the crisis, Berlin has completely rejected the return of Russian gas, on which the country relied before the invasion of Ukraine.
Working from home as a fuel saver
Along with fuel rationing, encouraging people to work from home is a common strategy. Pakistan Four days work a week has been made mandatory for government employees Dominican Republic It is also encouraging businesses to cut back on the time employees spend on site.
in Africa, egypt The government is looking to cut its energy use by ordering that shopping malls and restaurants close by 9 pm and all government premises close by 6 pm. bangladesh And Thailand To save on air conditioning costs, the maximum temperatures allowed in government buildings are set at 25 and 26 °C (77–78.8 °F), respectively.
back to Africa, kenya has responded by imposing restrictions on exports as well as strict rationing of fuel. zambia Like Asia, Africa, which is particularly dependent on oil from the Middle East, has been threatened with fines for anyone hoarding petrol.
“It’s for the everyman,” said Anibor Kragha, executive secretary of the African Refiners and Distributors Association trade body. financial Times. “Even exporters are asking how they meet domestic demand first. It’s not just refining – but also storage, distribution infrastructure, pipelines and ports. When you look at it in totality, you start to see how exposed Africa is.”
Stop flying, start taking public transportation
IEA has also urged people to avoid air travel We The airline United Airlines has already warned that it may need to raise ticket prices by 20%.
Another recommendation is to use public transportation as much as possible. This is naturally easier in some countries than others, and incentives such as Germany’s 2025 policy to reduce the wide range of €9 transport tickets may have to be introduced in different places.
The use of liquefied petroleum gas (LPG) has also come into the limelight. The IEA has advised that LPG should be shifted from transportation to essential household purposes, especially cooking.
this is important IndiaSecond largest importer and third largest user of LPG. LPG imports into India have halved in March, leaving restaurants, hotels and cafes struggling. Some businesses are opening less frequently or in smaller quantities, while government officials say priority will be given to supplies to the 300 million households that use LPG for cooking.
Edited by: Rob Mudge