Jessica Alenius, CEO of Drivkraft Sverige, said there is no shortage of petrol on the horizon and that rationing of petrol and diesel will not be necessary. David Sällh, responsible for security issues at the fuel companies' industry organization, called calling for rationing now premature, like crying wolf. However, Finance Minister Elisabeth Svantesson has said that rationing of oil may become a possibility, reflecting a disagreement between industry experts and the government on the severity of the crisis. Drivkraft Sverige warned that it is mainly jet fuel that could face shortages, and the situation worsens the longer the war continues. Prime Minister Ulf Kristersson stated that the crisis could create serious disruptions to air traffic.
The Strait of Hormuz is effectively closed due to Iranian naval mines and threats, according to research. About one-fifth of the world's oil normally passes through the strait. The International Energy Agency (IEA) says the disruption is the largest supply disruption in history. Fatih Birol, head of the IEA, said Europe has about six weeks' worth of jet fuel left if the Strait of Hormuz remains blocked. Europe produces 70% of its jet fuel needs and imports 30%, according to multiple reports.
Higher fuel prices may make it unprofitable for airlines to fly, leading to cancellations and reduced demand.
Sweden has reserve stocks of petrol and diesel for 90 days of consumption, and has committed to having emergency stocks equivalent to 90 days of net imports, according to research. The Swedish Energy Agency sees no immediate risk of physical oil shortages in Sweden in the short term. Sweden imports limited crude oil directly from the Middle East but is integrated into the European energy system, meaning disruptions affect it indirectly. Sweden has not yet started drawing from these reserves, and they would last much longer in practice because imports will not stop completely, multiple reports indicate.
When fuel becomes scarce, prices increase first, according to multiple reports. Higher fuel prices may make it unprofitable for airlines to fly, leading to cancellations and reduced demand, David Sällh said. To some extent, there is self-regulation in the fuel market, multiple reports indicate. Other oil producers like the USA and Nigeria could potentially compensate for some of the shortfall with increased deliveries, according to multiple reports.
Calling for rationing now is premature, like crying wolf.
There has been no rush to petrol stations to preempt possible fuel rationing, multiple reports indicate. Circle K and Preem confirm that there has been no panic buying. Circle K states that there were some tendencies for increased volumes at the start of the war, but volumes are now back to normal. Preem refines its own petrol and diesel, and the vast majority of its oil comes from the North Sea. Preem views the markets it operates in with confidence, its press service said.
There are several tools available, including consumption-reducing measures decided jointly in the EU, according to multiple reports. The IEA has initiated a release of 400 million barrels of crude oil from member countries' reserves, according to research.
Europe has about six weeks' worth of jet fuel left if the Strait of Hormuz remains blocked.
Higher oil prices lead to increased transportation costs, electricity prices, and inflation in Sweden, according to research. The UAE is Sweden's third-largest trading partner in the Middle East, with over 250 Swedish companies operating there. Swedish exports to the UAE reached roughly $1.4 billion in recent years. Swedish firms like Ericsson, Volvo, and IKEA have operations in the UAE and Gulf region, exposing them to regional instability.
The UK government has announced a £53m package for low-income households using heating oil, according to research. China has stockpiled 900 million barrels of oil, according to some estimates, and has ordered its oil refineries to stop exporting fuel to keep domestic prices under control, reportedly. India's oil ministry said it secured crude oil supplies for 60 days and urged against panic buying. India slashed petrol and diesel excise duties from 13 rupees per litre to three, according to research.
Europe's dependence on imported jet fuel makes it particularly vulnerable. With the Strait of Hormuz blocked, Europe has about six weeks' worth of jet fuel left, according to the IEA. This could lead to widespread flight cancellations and economic disruption across the continent. Sweden, while not directly reliant on Middle Eastern crude, is part of the European energy system and will feel the effects of any shortages.
Several unknowns remain. How long the Strait of Hormuz will remain effectively closed is uncertain. It is unclear what specific measures Sweden will implement if jet fuel shortages worsen. Whether other oil producers like the USA and Nigeria will actually increase deliveries to compensate for the shortfall is not known. The actual extent of panic buying or stockpiling by consumers and businesses remains unclear, as does how much of Sweden's 90-day reserves have been used or are accessible.