“The initial impact was mitigated by the fact that energy markets had room to maneuver and absorb. Tensions in the Strait of Hormuz have escalated again, and that space is now much smaller and shrinking even more, as spare oil production capacity has been used, demand has shrunk, and fuel stocks have been depleted“, IMF experts write.
“Why haven't prices risen higher? The answer lies in a combination of factors that helped mitigate the initial impact. Much of that capacity, however, has already been exhausted“, IMF experts emphasize. They say “a rapid restoration of supplies is vital to avoid further damage to the global economy“.
“By the end of May, more than 1.1 million barrels of crude oil - equivalent to approximately 10 days of typical global consumption - were not entering the market. At that point <...> the shortage of raw materials exceeded the figures of the 1973 oil crisis, the Iran-Iraq war and the Persian Gulf war“, the authors of the note note note.
A significant part of the possibilities for mitigating the energy crisis caused by the US-Israeli war with Iran have already been exhausted. This conclusion is contained in a new analytical note of the International Monetary Fund (IMF), published on its blog.