Oil markets are entering an unprecedented period of uncertainty due to geopolitical instability and a fragile global economy, the head of the International Energy Agency (“IEA”) said on Tuesday.
The IEA was founded in 1974 to help countries co-ordinate a collective response to major disruptions in the supply of oil. The IEA examines energy issues including oil, gas and coal supply and demand, renewable energy technologies, electricity markets, energy efficiency, access to energy, demand side management and much more.
OPEC is advocating for an oil supply reduction of 1 million to 1.4 million barrels per day to prevent and correct crashing oil prices similar to what transpired in 2014.
Another factor contributing to the fall of oil prices is the restoration of sanctions by the United States to Iran earlier this month cutting the country’s crude exports by close to a million barrels per day. The United States said it sanctioned six individuals and three entities to disrupt an Iranian-Russian network that it said was providing millions of barrels of oil to the Syrian government and funding militant groups Hamas and Hezbollah.
U.S. officials said Russia facilitated the delivery of oil from Iran to Syria, and that a variety of mechanisms were used in an attempt to conceal the shipments and oil-related payments.
Today Brent oil is currently trading around $62 a barrel.