ALEXANDRIA, Va.—The International Energy Agency (IEA) is warning nations around the world to conserve their oil and gas use, as Russia’s invasion of Ukraine is a threat to supply, reports the New York Times. Supply inventories are at a historic low, and “reducing demand is a way of addressing the situation without just pumping more oil,” said Faith Birol, the agency’s executive director.
The agency listed 10 immediate recommendations on how nations can conserve oil. Steps include driving slower, having people work from home up to three days a week and urging travelers to take trains instead of airplanes when possible. The agency also recommended car-free Sundays in cities, car pooling and a fare reduction on public transportation, and it also encouraged long-time changes, including prioritizing electric vehicles and using electric heat pumps.
If all 10 recommendations are actually done by advanced economies, the agency says that oil demand would be cut by 2.7 million barrels a day. IEA estimates that three million barrels a day of Russian oil will be lost to global markets in the next few months as buyers refuse it, according to the Times.
In response to the warning by the IEA, oil prices rose more than 7% yesterday, reports Reuters. Benchmark Brent crude futures gained $7.47, or 7.6%, to $105.49 a barrel. U.S. West Texas Intermediate crude was up $6.85, or 7.2%, to $101.89 a barrel. Morgan Stanley raised its Brent price forecast by $20 for the third quarter to $120 a barrel, predicting a fall in Russian production of about 1 million barrels per day from April.
“Both supply and demand are hurting, but supply is currently hurting more and a tight oil market for the coming two quarters is to be expected,” bank SEB told Reuters.
The average cost for a gallon of gas is at $4.29, according to AAA Gas Prices, which is 75 cents more than a month ago and $1.39 more than one year ago.
Gas stations led U.S. retail sales gains in February, with sales up 5.3% compared with January as overall retail sales showed a seasonally adjusted 0.3% increase last month compared with January, according to retail sales data for February released by the U.S. Commerce Department.
Sales at food services and drinking places rose 2.5%, and sales of autos and auto parts were up 0.8%. Compared with February 2021, sales at gas stations climbed 36.4%, while sales at food service and drinking places were up 33% from last year, according to U.S. Census Bureau data. Meanwhile, sales at grocery stores fell 0.8% from January but gained 8.4% from the year-ago period.
Compared with February 2021, overall retail sales were up 17.6%.
Get an overview of NACS benchmarking data on the convenience and fuel retailing industry’s performance in 2021 and a look ahead at the NACS State of the Industry Summit, April 12-14 in Chicago.