Interview: "Only through collective action can we fight a global crisis" 

Q: 2026 has put oil security of supply back at the top of the agenda. Why is the Oil Forum important this year? 

Priit: We have not seen a year like this in the last 50-plus years, with a real supply shock and geopolitical events constantly impacting the markets, the governments, the policies and the consumers. At the Forum,  work through these changes, because for governments to polish their oil stockholding policies, they need to understand the markets.  

Q: Ian, how is this supply shock different from previous supply shocks and energy crises? 

Ian: US foreign policy since World War Two has been to police the playground and make sure international shipping routes are kept open, to allow free trade and the global economy to prosper. This seems to be shifting. The attack on Iran by Israel and the United States in February this year was the biggest geopolitical event we've seen in our time covering oil markets, and much more significant because of the volume that goes through there. It's really the jewel in the crown in terms of oil flow. We periodically lost 21 million barrels per day, about 20% of world supply. The market reaction was very sharp, but less than we expected. We're surprised the Americans went in without a clear plan to secure the Strait of Hormuz --  undoing the post-World War II doctrine -- and that the market has taken it in its stride. 

The reason for relatively lower prices is China. They took advantage of the surplus from the second half of 2024 into 2025 to increase their stocks, so they have been able to hold back from buying their full volumes in Q2 and Q3 of this year. But there's a limit to how many times you can raid the piggy bank. We have really drained the US SPR, the emergency reserves, and China has probably used up a fair amount of its reserves. I suspect we're going to see China return to the market as we head into winter, which would likely push prices up. 

Q: Given this, what does the picture look like later this year? 

Ian: Our fear is that we could see more price spikes, and quite dramatic ones. The catalyst could be a number of things. First, geopolitically, we have the US midterms in early November. If I were sitting in Tehran as the Supreme Leader, I might be thinking: let's not make this easy for Trump. The only way to do that is by lashing out.  

On top of that, Ukraine has run a very successful campaign over the last 18 months hitting Russian refineries. The Russian economy is essentially a one-trick pony built on oil and gas exports. As a result, there's a lack of Russian diesel going to regions other than Europe (Europe has banned it), so those countries are bidding for the same cargoes we Europeans are. 

There are also supply risks. We're heading into refinery maintenance season. US refineries are running at 98% utilization, which is exceptionally high, and there's a limit to how long you can put off maintenance. Global refinery outages are something like five million barrels a day above normal, leaving refined product supply very tight. We're also heading into a higher-demand environment. As winter arrives, the focus will shift to heating oil. 

Q: Priit, what does that competition for the same cargoes mean for the smaller markets in the Energy Community? 

Priit: Oil supply is very different from power supply, or even from pipeline gas. Oil is very much market-driven. It flows to the highest bidder. We are, in a way, all in competition, globally. There is no Moldovan oil market. There is no Armenian oil market. If there is a shortage, it affects everyone. So, crisis mitigation is not a domestic issue. Having a few thousand tonnes to supply your own fire brigades back home is only a micro layer. This is really about solidarity: only through collective action can we fight a global crisis. 

Q: What lessons should we take from this moment, especially in the Energy Community region? 

Ian: There are four lessons. The first thing is efficiency: reducing the miles we travel and making our motor fleet more efficient. The second is alternatives, such as biofuel mandates, reducing demand for fossil fuels, which ties in with decarbonisation plans.  

The third, which is very important, is energy security: having emergency reserves. The temptation is not to build them, because they're costly, but they're really important. 

The fourth is diversity of supply. We need good relations with stable countries, whether in Africa, Europe or wherever, and we need to keep developing the assets we have locally. 

Q: Priit, where do the Contracting Parties stand? 

Priit: Crisis preparedness is more than having emergency oil stocks. The Oil Stocks Directive requires Energy Community Contracting Parties  to have contingency plans -- clear responsibilities and procedures in place before a supply disruption occurs. These elements are increasingly reflected in legislation across the reigon. The key is to ensure that stocks, procedures, and institutions can work together when a crisis actually occurs. 

 Of course, physical stocks are important, and there are encouraging advancements in the region. Moldova has progressed very well with its legislation. You can build security of supply without dedicated legislation, but having it gives you many more tools and builds the foundation for your next steps. Now Moldova needs to move fast with implementation. Albania has also been progressing with its drafts and has very little left to do. In contrast, in Bosnia and Herzegovina, while state-level legislation is still pending, the Federation has invested in both storage infrastructure and physical stocks to strengthen its ability to respond to supply shocks.  

Serbia, Montenegro, and North Macedonia are actually the leaders. All three have the legislation in place and have already established physical stocks, with decent volumes in terms of days of stocks. Unfortunately, oil stock building is relatively expensive and needs budget allocations or decent funding models. Some had purchased tenders planned for exactly early 2026. Then the market shock came, and suddenly the funds were not sufficient to finalise those tenders. But at least they have a clear vision. The examples differ, but the direction of travel is the same – towards stronger crisis preparedness. 

Q:  The Energy Community Secretariat is forming a new Oil Coordination Group. What's the idea behind this and how can it help?  

Priit: The Oil Coordination Group could really help us move in the right direction. The experience of the EU Oil Coordination Group shows that effective cooperation and mutual trust between countries are built over time, through regular exchange of information and working together on common challenges, and this doesn't happen overnight.  One part of the Oil Coordination Group's work would be market monitoring: discussing how the markets are doing, how sustainable they are, where we see strengths and where we see shortages. Market monitoring is a key part of emergency preparedness, because global changes in the oil market can very quickly have local impacts, and you need a firm grasp of what is happening to respond in time. The Oil Coordination Group will help us see both the regional picture and developments beyond the Energy Community, while also creating a bridge to the EU Oil Coordination Group. As 2026 has clearly shown, major supply crises do not stop at national or regional borders. They therefore require cooperation and a coordinated response. 

The second is data. Oil security of supply is very much based on data, but formal statistics can be too slow.  Our Contracting Parties often have relatively lean supply systems, and these systems are changing fast, with new pipeline, refining, port and terminal projects, often driven by commercial developments.  The Oil Coordination Group could provide a platform for maintaining a more up-to-date picture of supply and demand. Against it, we can predict potential risks, stresses and shortages, and see how to secure those weak points. 

Q: Finally, Ian talked about alternatives like biofuels to decarbonisation. How does security of oil supply itself fit with the energy transition?  

Priit: I don't see security of supply and the energy transition as opposing objectives. People who work on security of supply are not necessarily advocates of any particular fossil fuel.  

The point is to make sure that the energy system can continue to function while the transition takes place.  In a crisis, policy often turns very simple. Overnight you hear: there's no time to wait: let's drill more, let's pump more.  Everybody just wants their engine to run so they can get from A to B. Having decent security of supply policies in place saves societies from energy policy U-Turns in crisis situations.