Attacks on South Pars: the start of a global energy crisis?
Mutual attacks on production and processing facilities at South Pars, the world's largest gas field, have caused natural gas prices to skyrocket. There are now fears that the shortages on global gas markets resulting from the de facto blockade of the Strait of Hormuz will be further exacerbated. The media paint a dire picture of an emerging global energy crisis.
Escalation underestimated
Trump has threatened to blow up a major gas field in Iran if it attacks Qatari facilities again. The Frankfurter Allgemeine Zeitung says the US president is misjudging the risks:
“The consequences would also be significant for the global economy, because the field, which Iran and Qatar share, is vital for exports to Asia and Europe. The impact of the US-Israeli air strikes should not be underestimated. But only Israel, hardened by decades of struggle for survival, is prepared to accept high costs. The Europeans are out of the picture, Trump's voters are growing impatient, America's allies in the Gulf have repeatedly been left defenceless. The Iranian regime has not yet lost.”
Danger of stagflation
Europe would once again be hardest hit by the potential energy crisis, notes Mladina:
“Like the Russian invasion of Ukraine four years ago, the US-Israeli attack on Iran marks the start of a global energy crisis. ... The problem is not just prices but physical disruptions in the energy supplies and deliveries of other strategic raw materials. ... Shortages could lead to disastrous stagflation and a crisis in the global economy after just a few months of war. The global struggle over oil resources and interests is once again highlighting the strained relations between regional and global powers. ... In this crisis, too, the EU is once again the strategic global player that is most severely affected.”
Shortages will lead to regression
Diena extrapolates:
“The world is splitting up into energy blocs, as well as into those countries with access to resources and those that are dependent on imports. ... In concrete terms this means that countries or alliances that are dependent on imports must switch to a kind of war economy - with strict rationing of energy and resources. The state then decides which sectors survive and which must be sacrificed. Added to this is a forced technological regression as countries are obliged to revert to simpler (and thus cheaper) production methods. After all, high tech requires stable global supply chains, and that stability has been destroyed.”
Full capacity won't be restored for years
Corriere della Sera fears shortages above all on gas markets:
“Had the gas market not been drawn into the Gulf conflict, Europe would not be facing its second structural energy crisis in four years. ... Instead, the past 48 hours have marked a further escalation of the conflict, with oil and natural gas facilities serving as hostages against which both sides are lashing out. An Israeli attack on South Pars, the gas field infrastructure shared by Tehran and Doha, was followed by an Iranian attack on the Qatari facility in Ras Laffan. Since the latter is one of the largest production facilities for liquefied natural gas and will take years to return to full capacity, the Gulf War is tightening the screws on the global economy even further.”
Food production also menaced
That the agricultural sector must not be ignored in preparations for an impending fuel crisis Göteborgs-Posten warns:
“This will require either the complete electrification of our agriculture (which would be difficult in the short term) or sufficient fuel reserves to maintain our food production. ... Sweden plans to maintain reserves of petroleum products such as petrol, diesel and aviation fuel for around 90 days. This means that there is no reserve specifically earmarked for the food industry. And that in turn means that here in Sweden we cannot guarantee food supplies in the event of severe crises that disrupt fuel imports.”