The Iran energy crisis has underscored the need for stronger energy security clauses in international trade agreements — provisions that would establish clear obligations for nations to cooperate in managing supply disruptions and ensure that trade barriers do not impede the flow of energy to where it is most needed during emergencies, the head of the International Energy Agency has argued. Fatih Birol, speaking in Canberra, said the current crisis had exposed gaps in the international trade framework’s ability to facilitate the rapid reallocation of energy supply during major disruptions. He described the crisis as equivalent to the combined force of the 1970s twin oil shocks and the Ukraine gas emergency.
Birol said trade agreements that facilitated energy flows during normal times often lacked robust provisions for emergency situations, when the temptation to restrict exports and prioritize domestic supply could impede the efficient global allocation of scarce energy resources. He called for a review of existing trade agreements to strengthen emergency energy cooperation provisions and for new agreements to include comprehensive energy security clauses from the outset.
The conflict began February 28 with US and Israeli strikes on Iran and has since removed 11 million barrels of oil per day and 140 billion cubic metres of gas from world markets. At least 40 Gulf energy assets have been severely damaged, and the Hormuz strait — through which approximately 20 percent of global oil flows — remains closed. The IEA deployed 400 million barrels from strategic reserves on March 11 in its largest emergency action.
Birol confirmed further releases were under consideration and said consultations with governments across Europe, Asia, and North America were ongoing. He called for demand-side policies including remote work, lower speed limits, and reduced commercial aviation. He met with Australian Prime Minister Anthony Albanese and said Australia’s extensive network of trade agreements gave it particular influence in advancing energy security provisions in international trade frameworks.
Trump’s 48-hour ultimatum to Iran to reopen the strait expired without result, and Tehran threatened retaliatory strikes on US and allied energy and water infrastructure. Birol concluded that trade policy and energy security policy needed to be treated as complementary rather than separate domains. He said the Iran crisis had demonstrated that without adequate energy security provisions in international trade frameworks, the world’s ability to manage major supply disruptions was severely constrained.