IEA urges nations to ‘redesign’ energy strategies; flags risks to food prices

SINGAPORE – The International Energy Agency or IEA urges nations to rethink their energy strategy to weather geopolitical challenges and address surging demand.

Energy markets are unlikely to go back to where they were before the US-Iran war, IEA Executive Director Dr. Fatih Birol said on the sidelines of the Singapore International Energy Week (SIEW).

“So therefore, the countries need to redesign the energy strategies, give a closer look at the energy partnerships, and maybe make some new decisions in terms of their fuel and technology choices,” Birol said.

He said partnerships should be made with “reliable producers and reliable exporters,” highlighting Saudi Arabia and UAE’s “heroic” efforts to bring oil and energy to markets using different trade routes.

Stockpiling is also “extremely important”, Birol said.

“We have to be all prepared for the rainy days. And in fact, we are in the middle of the rainy days today in the world. And I hope it doesn’t rain even more than this. It’s getting a bit more difficult to manage. And it is important that the countries put some oil or products aside to be used on the rainy days. And we have seen the benefits of that several times during this crisis, but also in the past,” he shared.

Birol said the IEA is helping countries build their reserves. Birol said, “I commend the Philippine government for paying attention.”

The Department of Energy earlier announced it would establish a Philippine Strategic Petroleum Reserve. Energy Secretary Sharon Garin said the Department of Energy estimated an initial P8 billion for the first phase with a capacity of 1 million barrels.

Birol also raised the alarm on the impact of elevated fuel prices, particularly on agriculture.

“In the other parts of the world, we are entering the planting season in many countries and both diesel prices being high and the fertilizer supply has been disrupted…I am worried about, in the next few months, implications for the food prices beyond,” he said.

Philippine inflation accelerated to 7.2 percent in September, way above the government target of 2 to 4 percent, with food and transport costs as the main driver. It has reached the same levels as during the Russia-Ukraine war in 2022.