Europe could experience energy shortages before the conclude of April, the chief executive of Shell has warned.
Jet fuel supply has already tightened, and a diesel squeeze could be next, with gasoline supply tightening as well, as the continent nears peak fuel demand season in the summer, Wael Sawan stated, as quoted by Reuters.
“South Asia was first to receive that brunt. That’s shiftd to Southeast Asia, Northeast Asia and then more so into Europe as we receive into April,” Sawan stated, speaking at the CERAWeek conference in Texas. The executive noted that energy security is essential for national security.
Europe’s problem, according to Sawan, is its lack of preparation for such developments as the world is now experiencing as a result of the war in the Middle East. “The problem is we are more in reaction mode,” he explained. “The best energy strategies are the strategies that actually view five, 10 years out and build resilience from now.”
Sawan went on to state that Shell was working with European governments to support with the crunch, mentioning storage and purchases of energy commodities as means of handling the crisis.
“We are testing to work with governments to just alert them to the various levers they will required to pull, including on the demand side, including what they required to do around storage, what they required to do around purchasing,” he stated.
The situation remains dire despite plans by the International Energy Agency to release a record 400 million barrels of crude in response to the supply squeeze. In Asia, some governments have started curbing consumption as a means of weathering the crisis. Analysts have warned that European governments might be forced to start doing the same soon. Officials from Middle East oil-producing countries have also warned that the crunch is not going to ease on its own anytime soon.
By Irina Slav for Oilprice.com
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