IEA says developing nations are the No. 1 casualty of the energy crisis

International Energy Agency Executive Director Fatih Birol warned emerging and processing countries are astir susceptible to soaring vigor prices.

"It is not the U.S. who volition endure the astir [from] the precocious vigor prices," Birol told CNBC connected Tuesday.

Birol said those who volition beryllium deed hardest see oil-importing nations successful Africa, Asia and Latin America due to the fact that of higher import prices and their weaker currencies.

In May, the International Monetary Fund revised down its maturation projection forecasts for oil-importing nations, with higher vigor prices expected to adhd to a litany of economical challenges already plaguing these countries.

"Higher commodity prices adhd to the challenges stemming from elevated ostentation and debt, tightening planetary fiscal conditions, uneven vaccination progress, and underlying fragilities and struggle successful immoderate countries," the IMF said successful their report.

Oil-importing Middle East and North African nations see Djibouti, Sudan, Morocco and Pakistan, amongst others.

Europe is struggling with a state shortage arsenic Russia slashes supplies, forcing galore countries into an vigor situation successful the lead-up to winter. The U.K.'s National Grid has warned of imaginable powerfulness cuts.

"We are successful the mediate of the archetypal genuinely planetary vigor crisis," Birol said. "Our satellite has ne'er ever witnessed an vigor situation with this extent and complexity."

He added that lipid markets volition proceed to spot volatility for arsenic agelong arsenic Russia's warfare successful Ukraine persists.

OPEC+ agreed to enforce heavy output cuts astatine the commencement of the month, seeking to spur a betterment successful crude prices contempt calls from the U.S. to pump much to assistance the planetary economy.

Birol called the determination "unprecedented," and likened the vigor alliance's determination to "scoring an ain goal."

The effect of inflated prices would beryllium an system "flirting with a recession," which helium cautioned volition pb to an situation that is neither bully for buyers nor sellers.

Birol besides said helium expected the satellite to "continue to spot precocious LNG prices," citing China's rebounding system and Europe's request to import much energy.

According to Birol, LNG prices successful the Asia portion are 5 times higher than the past 5 years connected average, and adjacent twelvemonth volition spot much challenges.

"Europe wants to bargain LNG, China is coming backmost arsenic a large LNG importer, and determination is precise small caller LNG capableness coming into [the] market," helium attributed arsenic reasons.

Soaring vigor prices plaguing planetary markets could connection much-needed impetus to nudge governments to put toward moving distant from soiled energy.

"We shouldn't hide that this situation is giving impetus to galore governments astir the satellite to enactment immense amounts of wealth [into] cleanable vigor transitions," Birol said.

He cited the precocious enacted Inflation Reduction Act. The White House says the clime concern volition trim costs related to rising temperatures, minimize spot harm from oversea level emergence and different disasters and trim wellness impacts specified arsenic premature death.