IEF Secretary General's Statement on Supply Shock

The International Energy Forum (IEF), as the leading neutral platform for producer-consumer dialogue, reaffirms its commitment to global energy security and restoring energy market stability in these challenging times. Ongoing developments in the Middle East highlight that energy security, market stability, affordability, and inclusive transitions depend on dialogue and data sharing. These are essential to deepening collective understanding of energy market dynamics across the IEF's diverse membership and to navigating an uncertain and more volatile energy market risk environment.

To guide producer and consumer responses and restore energy market confidence, the IEF calls on governments and other stakeholders to strengthen dialogue and collaboration anchored on three shared principles:

1. Reaffirm the Inviolability of Energy Infrastructure and Trade Routes
2. Acknowledge Producer-Consumer Interdependencies and Work Together on Data Transparency
3. Enhance Dialogue on Energy Security and Resilience as Markets Shift

Together, these principles reaffirm the IEF's foundational mandate: to strengthen trust and cooperation among producer and consumer countries, support more informed industry investment decisions, and reassure wider publics that governments and stakeholders share a common commitment to secure infrastructure and trade routes, better energy data, resilient markets, and orderly, just transitions.

They also help safeguard shared goals such as accelerating sustainable development and keeping climate change within acceptable thresholds by reducing greenhouse gas emissions while ensuring universal access to affordable, reliable, sustainable and modern energy.

IEF Shared Principles:

1. Reaffirm the Inviolability of Energy Infrastructure and Trade Routes

The inviolability and protection of energy infrastructure and trade, including the safe, unhindered passage of energy shipments across international land routes and maritime corridors must be reaffirmed and protected. Disruptions to energy and related essential public services, as a rule, target the most vulnerable populations first. The cascading effects risk severely limiting global economic growth and development prospects for all energy market stakeholders, delaying shared goals by decades.

Global energy markets serve as mechanisms for advancing economic growth and development and sharing prosperity more widely.

Dialogue should focus on legitimate security of supply and demand considerations and reviewing energy market policy, regulation, and diversification opportunities. This includes risk management options to improve energy security, supply chain resiliency and the reduction of transaction costs and hurdles on global energy markets.

2. Acknowledge Producer-Consumer Interdependencies and Work Together on Data Transparency

Energy Markets and the supply chains that support the broader global economy are built upon complex and diverse interdependencies between producers and consumers within and across sectors and geographies. Acknowledging that these are best managed through ongoing dialogue and engagement and working together to improve and share official government data on energy market fundamentals in the neutral setting of the IEF is an important element in ensuring market stability and global energy security.

Three successive energy system shocks have underscored that producers and consumers remain deeply interconnected and that reliance on essential commodities such as oil and gas, refined products, and critical minerals and the growing links between energy, industrial, and wider commodity markets, mean decisions in one part of the system can quickly affect energy security, affordability, and supply chain resilience elsewhere.

The global economy runs on energy and energy supply chains that are complex and stretch across diverse geographies and economic sectors. Deepening collective understanding of energy market opportunities and challenges under market shocks and changing conditions benefits government, industry and household budgets, helps to overcome global divisions and reinforces international cooperation. Transparent reporting remains the cornerstone of resilient markets, especially for restoring market balances swiftly and effectively during energy market shocks and crises.

The current energy crisis highlights significant data gaps and reporting delays in data submissions on important energy market fundamentals and key market segments. Blind spots resulting from insufficient reporting of primary and official data on strategic oil and gas stocks and inventories, including national and international bunker fuels, middle distillates such as gasoil and jet fuel, gasoline, and diesel, demonstrate that key lessons from the global energy crises of 2020 and 2022 have not yet been fully absorbed. Sovereign and commercial concerns also contribute to withholding data in a more geopolitically adverse and competitive energy market. Timely, complete and granular energy market data reporting is urgently needed to detect emerging imbalances, reduce distortions in market signals, and restore stability more quickly and dependably.

Greater commitment to sharing official energy market data can help stabilize prices at affordable levels faster, and reinforce informed decision making, policy predictability, and investor confidence needed to move projects forward. Energy market stability and affordability will only benefit from better official data reporting on both traditional and new energy sources shared through improved submissions to official statistical offices and the Joint Organizations Data Initiative (JODI).

The IEF's global scope and mandate uniquely position it to help IEF governments and industry stakeholders navigate market swings and recover from crises with greater resilience through sustained dialogue and data-sharing, on policy evolutions and market fundamentals. This work is advanced through IEF Ministerial Dialogue, JODI collaboration, joint IEA-IEF-OPEC initiatives within the trilateral work program, and other outreach with global and regional organizations such as the G20, GCC and European Union on the neutral IEF platform.

3. Enhance Dialogue on Energy Security and Resilience as Markets Shift

To avoid policy reflexes that retreat from international energy markets, and that can prove cumbersome and costly for governments and households already facing a persistent cost-of-living crisis, the IEF encourages producers and consumers to enhance dialogue on reinforcing the international foundations of energy market security and resilience.

This includes discussion on taking a more holistic, systems-based approach to balancing security of energy demand and supply in a more dynamic market and technology environment, recognizing the broader economic consequences of energy security risks. This may encompass dialogue and data on the cost and maintenance of spare capacity, strategic stocks, inventories, emergency measures, contingency planning and investment, and the development of alternative trade and transit points to mitigate chokepoint vulnerabilities.

Past and ongoing shocks also show the limitations of current contingencies and emergency measures within crude oil, petroleum products, natural gas, LNG, and markets for critical minerals and other essential commodities.

Deepening dialogue on these issues should support measures for oil, gas, and related essential commodities such as fertilizer as well as other critical minerals ranging from copper to neodymium. This will contribute to market stability and more rational responses to future market swings and disruptions.