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• Advanced economies could reduce oil demand by 2.7 million bpd within four months
• Proposals include lower speed limits, more public transport
The International Energy Agency on Friday said the countries could dampen the oil shortage caused by Russia’s invasion of Ukraine by restricting the use of cars.
“We are experiencing a major crisis,” IEA Executive Director Fatih Birol said at a press conference. “Oil markets are in an emergency situation. And not only that — it may even get worse than today in the next few months.”
The Paris-based autonomous intergovernmental organization on Wednesday in a report said immediate actions by the advanced economies could cut oil demand by 2.7 million barrels a day within four months.
IEA also introduced a 10-step plan to cut the demand and said since the majority of oil demand comes from transport, the plan “focuses on how to use less oil getting people and goods from A to B, drawing on concrete measures that have already been put to use in a diverse range of countries and cities.”
Plan to dampen the shortage
The plan is to ease the supply strains by almost offsetting the 3 million barrels per day (BPD) loss of Russian production for April and reducing the price pain consumers feel worldwide.
IEA foresees that the plan would help move oil demand to a more sustainable pathway.
Russia’s invasion of Ukraine has overturned global commodity markets with soaring prices and prompting an urgent search for alternative energy sources.
On Friday, the global oil benchmark Brent crude price was recorded at $106.42 a barrel, and the U.S. benchmark West Texas Intermediate (WTI) price at $103.04 a barrel.
The IEA’s plan to curtail oil demand includes lower speed limits for cars, urging people to work from home, making public transport cheaper, encouraging carpooling, and using the high-speed railway system and virtual meetings instead of air travel.