Khaberni - The International Energy Agency said that the closure of the Strait of Hormuz caused the biggest disruption in the history of global oil markets, amid expectations that supply will decrease by about eight million barrels per day in March, which is approximately 8%.
The agency's member countries agreed to its proposal to withdraw a record 400 million barrels from strategic reserves to stabilize oil prices and compensate for the loss of Middle East production.
Below is a list of some previous oil supply disruptions:
*The Arab Oil Embargo from 1973-1974
The October 1973 war, initiated by coordinated attacks by Egypt and Syria on Israel, sparked the Arab oil embargo.
Arab producers, through the Organization of Arab Petroleum Exporting Countries (OAPEC), ordered an immediate production cut of 5%, followed by additional monthly cuts of 5%.
This action was taken to pressure Western countries to force Israel to withdraw from the Arab territories it had occupied since the 1967 war.
Declassified documents prepared by the National Security Council for President Richard Nixon estimated that the embargo would lead to a shortfall in US supplies of two to three million barrels per day, with the total shortfall in embargoed countries reaching about 4.5 million barrels per day.
American government records showed that OAPEC announced the embargo on October 17, 1973, and it remained in effect against the United States until March 1974.
Crude oil prices rose to nearly four times as a result, from about $2.90 per barrel before the embargo to $11.65 by January 1974.
The US government prepared plans for fuel rationing, ordered industries to switch from oil to coal, pushed for increased domestic production, and rushed to enact emergency energy legislation.
The crisis led oil-consuming countries to establish the International Energy Agency in 1974 to coordinate responses to supply disruptions.
The Iranian Revolution from 1978-1979
Political turmoil in Iran led to the downfall of Shah Mohammad Reza Pahlavi's government and the rise of Ali Khamenei. Iranian oil production sharply fell by 4.8 million barrels per day, approximately 7% of global supplies, by January 1979.
Oil prices began to rise rapidly in mid-1979 and more than doubled between April 1979 and the same month the following year, driven by fears of further disturbances, speculative storage, and strong global demand.
The crisis contributed to rising inflation in the United States. In August 1979, Paul Volcker was appointed as the chairman of the Federal Reserve, and the bank adopted a strict monetary tightening policy to curb inflation.
These policies broke the cycle of stagflation but, along with the oil shock, drove the US economy into a sharp recession.
Hurricanes Katrina and Rita in 2005
Hurricane Katrina struck the American Gulf Coast in August 2005, causing a significant shutdown of offshore production.
US government data showed that at the peak of the disruption on August 29, 2005, production of about 1.38 million barrels per day was halted. The losses led to a gradual decline in production, but it was still in the range of 840,000 barrels per day by September 16, 2005.
This was followed by Hurricane Rita in September, where disruptions caused by both hurricanes combined led to a production halt reaching up to 1.53 million barrels per day at the peak of the disturbances on September 26, 2005.
The US Department of Energy loaned 9.1 million barrels of crude oil from the Strategic Petroleum Reserve to refineries. The United States participated in a coordinated draw of 30 million barrels from the reserves in cooperation with the International Energy Agency.
Regulatory authorities issued emergency waivers allowing the use of winter gasoline and high sulfur diesel fuel and temporarily suspended the Jones Act to allow foreign ships to transport fuel between US ports to alleviate supply bottlenecks.
The War on Ukraine 2022
The comprehensive Russian attack on Ukraine in 2022 led to a global energy crisis, prompting European countries to reduce their reliance on Russian oil and gas.
Prices jumped more than 50% within a few weeks, with crude oil prices hitting their highest levels since 2008 due to the search for alternative supplies.
In March 2022, then-US President Joe Biden ordered the withdrawal of 180 million barrels over six months to combat the sharp rise in prices.
The United States and other Western countries imposed a price cap on Russian oil exports, aiming to limit Russia's funding for the war without removing its oil from the market.
