FT: Summer demand adds pressure to global fuel markets

Nearly 80 countries have introduced emergency measures to shield their economies as the world edges toward a more dangerous stage of the energy crisis fueled by the war involving Iran.

Governments are intensifying contingency plans amid growing fears of a major disruption in global oil supplies. Traders warn that crude prices could surge sharply again unless more fuel shipments trapped in the Gulf are able to pass through the blockaded Strait of Hormuz, Financial Times reports. 

Analysts say the situation is raising the risk of a global economic shock, particularly for energy-importing nations in Europe and Asia.

Paul Diggle, chief economist at fund manager Aberdeen, said his team is examining a scenario in which Brent crude could climb to $180 per barrel, triggering a wave of inflation and pushing several economies into recession.

“We are taking that outcome very seriously,” he told the Financial Times, adding that it was not yet his base case. “We are living on borrowed time.”

The pressure on global energy markets is expected to intensify in the coming weeks as demand for air conditioning and summer travel rises across the northern hemisphere.

At the same time, supplies of crude oil, gasoline, diesel and jet fuel are tightening, with global stockpiles declining at what analysts describe as the fastest pace on record.

By Sabina Mammadli