The Iran energy crisis is triggering dangerous secondary shocks across global commodity markets far beyond oil and gas, the head of the International Energy Agency has warned. Fatih Birol, speaking in Canberra, said disruptions to the supply of fertilizers, petrochemicals, sulfur, and helium were now cascading through agricultural, manufacturing, and technology supply chains in ways that would compound the primary energy shock. He described the overall crisis as equivalent to the combined force of the 1970s twin oil shocks and the Ukraine gas emergency.
Birol explained that commodity markets were deeply interconnected, and that disruptions in one sector inevitably rippled through others. Fertilizer shortages would drive up food production costs and ultimately consumer food prices. Petrochemical shortages would affect plastics, packaging, and manufacturing inputs across dozens of industries. Helium shortages would constrain medical imaging and semiconductor manufacturing. Sulfur shortages would affect phosphate fertilizer production, compounding agricultural supply problems. Each of these secondary shocks had its own cascading consequences.
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 and industrial 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 the IEA was consulting with governments across three continents. 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 the full breadth of commodity market consequences demanded a response that went beyond energy ministries to encompass agricultural, industrial, and trade policy.
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 by warning that the secondary commodity market shocks from the Iran crisis were still developing and their full extent was not yet clear. He said governments needed to monitor and respond to the full spectrum of commodity market consequences, not just the headline oil and gas emergency.