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The International Energy Agency on Friday urged governments to enact measures including car-free Sundays to cut global oil consumption within months following supply fears stemming from Russia's invasion of Ukraine.
The agency also called on the Opec+ group of oil-producing nations led by Saudi Arabia and Russia to help “relieve the strain” on markets, while saying that the world is facing the biggest shock to supply “in decades".
The outbreak of war in Ukraine has caused fuel prices to skyrocket, as major economies such as the US and Canada sanction Russia and ban its oil imports.
The agency warned earlier this week of the risk of a global supply crisis as major oil companies, trading houses, shipping firms and banks shun Russia.
The measures, put forward together with the French government, could reduce consumption by 2.7 million barrels a day.
Advanced economies currently consume between 44 and 45 million barrels a day, agency estimates show.
Together the world's advanced economies account for “around 45 per cent of global oil demand”, it said.
The proposals, principally aimed at transport, include reducing speed limits, working from home three days a week, car-free Sundays, cheaper public transport and greater use of long-distance trains over planes.
IEA's 10 point action plan to cut fuel use
- Reduce speed limits on highways by at least 10 kilometres per hour
- Work from home up to three days a week where possible
- Car-free Sundays in cities
- Make the use of public transport cheaper and incentivise micromobility, walking and cycling
- Alternate private car access to roads in large cities
- Increase car sharing and adopt practices to reduce fuel use
- Promote efficient driving for freight lorries and delivery of goods
- Using high-speed and night trains instead of planes where possible
- Avoid business air travel where alternative options exist
- Reinforce the adoption of electric and more efficient vehicles
With the threat that supplies of Russian oil could be cut even more, “there is a real risk that markets tighten further and oil prices escalate significantly in the coming months” as the world enters its peak demand season, the agency said.
“As a result of Russia's appalling aggression against Ukraine, the world may well be facing its biggest oil supply shock in decades, with huge implications for our economies and societies,” the agency's executive director, Fatih Birol, said in a statement.
Increases in supply of the crucial commodity “would not be able to ease the current strains” after the “disappointing outcome” of a recent monthly meeting of Opec+, the report concluded.
Opec+ has resisted US pressure to step up production for months, agreeing only to modest increases in output at its regular meetings, even after Russia invaded Ukraine.
The agency was hoping for “some good messages which could help to relieve the strain on the oil markets” after the group's next meeting on March 31, Mr Birol said at a press conference to present a plan to cut demand.
