IEA chief expects energy crisis to persist into 2027

International Energy Agency Executive Director Fatih Birol said Friday he expects the energy crisis to continue into 2027, warning that the world will still be dealing with its consequences as governments seek alternative energy sources and strengthen supply security.

Addressing the Investment Summit Towards COP31 in Istanbul remotely, Birol said developments worldwide and countries' energy policies offered little reason to expect normalization next year.

"I am not optimistic about normalization in 2027," he said. "Even when I try to look at things optimistically, I cannot find an argument that convinces me."

"This crisis will continue in one form or another in 2027. The world will still be trying to heal its wounds, provided no new wounds emerge," he added.

Birol said the crisis in the Strait of Hormuz was affecting the economy, agriculture, and energy, prompting governments, companies, and investors to reconsider their short- and long-term strategies.

He drew parallels with the oil crises of 1973 and 1979, which he said spurred nuclear energy development and improvements in vehicle efficiency.

- Electrification push at COP31

Birol described COP31 as a "golden opportunity" for Türkiye and a major opportunity for the world, arguing that the current crisis could help build support for concrete outcomes.

He outlined a proposed commitment to increase electricity's share of global energy from 23% to 35% by 2035, with countries encouraged to sign on at the Antalya summit.

Greater electrification would strengthen energy security while reducing emissions, he said, offering a common objective at a time of deep international divisions.

Adoption would also send an unequivocal signal to investors and capital markets, he added.

Birol said participation levels and an agreement on electrification would be two key measures of COP31's success, expressing optimism about both the number of governments attending and their level of representation.