When International Energy Agency Executive Director Fatih Birol warns the world has already lost 11 million barrels of oil per day, surpassing the combined shocks of the 1970s, it is not a technical observation. It is an indictment.
His most damning line should not be ignored. “The depth of the problem was not well appreciated by the decision makers around the world.” That is not a throwaway remark. It is a blunt admission that those in charge failed to read the signals, failed to plan, and are now scrambling to contain a crisis that has already spiralled beyond control.
The oil shocks of 1973 and 1979 each removed around 5 million barrels per day from global supply. Together, they reshaped economies, toppled Governments, and forced a fundamental rethink of energy security. Today’s loss of 11 million barrels per day exceeds both crises combined. Yet the global response so far has been hesitant and reactive.
This is not simply about oil. The crisis has already spread across gas markets, with losses nearing 140 billion cubic metres, almost double the disruption triggered by the Ukraine war. Supply chains tied to energy are now under strain. Fertiliser, petrochemicals, sulphur, helium, all are being disrupted. These are not peripheral commodities. They sit at the core of food production, manufacturing, and industrial stability.
Roughly half of the world’s urea supply moves through the Strait of Hormuz. Any sustained disruption will translate directly into higher food prices, particularly in import-dependent economies. The consequences will not be theoretical. They will be felt in households, markets, and political systems.
Markets have already reacted. Brent crude surged past $ 110 per barrel before retreating slightly following signals of temporary de-escalation. Even after a drop, prices remain above $ 100. Economists are warning of inflationary pressure, stalled monetary easing, and the real possibility of economic contraction if prices approach $ 140.
What is striking is not just the scale of the crisis, but the lack of strategic anticipation. The Middle East has long been the fault line of global energy security. The risks were known. The vulnerabilities were mapped. Yet Governments behaved as if stability was guaranteed.
Birol’s warning that “no country will be immune” should be taken literally. Energy shocks do not respect borders. They cascade. Higher fuel costs raise transport prices. Transport costs raise food prices. Food inflation fuels social unrest. Central banks tighten policy. Growth slows. Political pressure builds. This is a chain reaction that has played out before.
The difference now is the world is more interconnected, more indebted, and arguably more fragile.
There is also a deeper failure at play. For years, leaders have spoken of energy transitions, diversification, and resilience. Yet many economies remain heavily dependent on imported fossil fuels, with limited buffers against supply shocks. Strategic reserves are inadequate. Infrastructure for alternatives is incomplete. Policy execution has lagged behind rhetoric.
Birol’s assessment cuts through this complacency. When he says the crisis is equivalent to “two oil crises and one gas crisis put all together,” he is not exaggerating. He is placing the current moment in its proper historical context. This is a convergence of shocks, not a single disruption.
The political implications are significant. Governments that fail to manage the fallout will face public anger. Rising living costs have already strained social contracts in many countries. Another sustained surge in energy prices could push that tension to breaking point.
For smaller, import-dependent economies such as Sri Lanka, the warning is even sharper. We do not have the fiscal space to absorb prolonged price shocks. We cannot influence global supply. Our only defence is preparation, diversification, and disciplined policy. Yet we remain exposed, relying on short-term fixes rather than structural change.
Energy security can no longer be treated as a secondary policy concern. It is central to economic stability, national security, and political survival. The failure to recognise this earlier is what Birol is calling out.
“The depth of the problem was not well appreciated.” That is the sentence that should stay with policymakers. It captures the essence of the moment. Not just the severity of the crisis, but the scale of the misjudgment that allowed it to unfold.
The question now is whether that lesson will finally be learned, or whether the world will once again wait for the next shock to force its hand.