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9 Mar, 2022 12:33

Current energy crisis compared to 1973 oil shock

French officials call for EU energy independence to avoid catastrophe
Current energy crisis compared to 1973 oil shock

French Economy Minister Bruno Le Maire compared the current situation on the energy market, sparked by sanctions on Russian over its military offensive in Ukraine, with the oil crisis of 1973.

“It is not an exaggeration to say that this energy crisis, this energy shock of 2022 is comparable in intensity, in brutality to the oil shock of 1973,” Le Maire told the Conference on Energy Independence on Wednesday morning in Bercy, France. He added that a second massive plan of public support, made in a “whatever the costs” model established during the Covid-19 crisis, will only “fuel the increase in prices,” and stated that France should not “repeat the mistakes made in 1973 in 2022.” 

According to Le Maire, it is necessary to invent a different model of dealing with the crisis in order to avoid stagflation, an economic situation characterized by a recession in economic activity in combination with strong inflation. The minister said the best response to the shock is “a single word: total energy independence of France and the European Union.” 

On February 24, Russian troops launched an attack against Ukraine which the Russian authorities described as a “special military operation” aimed at “demilitarizing and denazifying” the country in order to protect the Russian-speaking population of the Donetsk and Lugansk regions.

Ukraine and Western allies have dismissed these claims and denounced Russia for what they call “unprovoked” aggression against a sovereign state. The UN adopted a resolution condemning the attack, while the EU, NATO members, and their allies worldwide have imposed severe economic sanctions on Russian officials and organizations in retaliation, including a ban on oil and gas exports to be adopted by several countries.