Fuel shortages: the countries already hit by the end of cheap oil

Fuel shortages: the countries already feeling the end of cheap oil

While official agencies keep repeating that peak oil is far off, a growing list of countries is suffering supply cuts, queues at petrol stations and blackouts. Bolivia, Mexico, Niger, Nigeria, Russia, Colombia, Malawi, Zambia, Mozambique, Pakistan and Cuba all appear in the same reports. The combination of runaway consumption and a shortage of new oilfields is starting to show at the pump. This is not a prediction: it is a list of countries already there.

The diagnosis circulating among energy analysts is uncomfortable: global production has not fallen, but demand from emerging economies has grown faster than supply, and states without enough hard currency to buy crude on the international market are the first to be left out. No pay, no fuel.

Which countries are suffering fuel shortages

The list is long and varied. Bolivia, Mexico, Niger, Nigeria, Russia, Colombia, Malawi, Zambia, Mozambique and Pakistan have all experienced supply problems at different points over the past year. Nigeria, which produces more oil than Mexico, appears in the same reports as Mexico. Russia, one of the world's largest producers, does too. The paradox is obvious: producing oil does not guarantee having fuel if there are no refineries, infrastructure or hard currency to pay for imports of refined products.

Cuba is another case cited. The blackouts are officially blamed on outdated infrastructure, but the island's oil production has been declining for years. Pakistan has been suffering a severe energy crisis for more than a year, with petrol station supply problems and frequent blackouts. According to available reports, the country has turned to converting agricultural waste into aviation fuel to maintain minimal strategic reserves.

The price argument: why Brent has not spiked

The most common objection is economic: if there were a real oil shortage, the Brent price would soar. It has not. The barrel came close to 150 dollars almost two decades ago and today trades well below that figure. For some analysts, this shows there is no structural shortage, but rather distribution problems and a lack of purchasing power in specific countries. The shortage is not global: it is local, and it affects those who cannot pay the market price.

Some argue that oil will never run out suddenly, but will become pogre scarcer. Supply will shrink relative to demand, and regions that neither produce efficiently nor hold reserves will be the first to fall. Europe, with barely any production of its own, falls into that category. Rising fuel costs will push part of the population towards electric cars, but the transition will not be a one-for-one replacement of today's vehicle fleet.

Fracking and the trap of paper reserves

The United States, once a net crude importer, has become one of the world's largest producers thanks to fracking and horizontal drilling. But the oil obtained through these methods is of lower quality, more expensive to extract and needs high barrel prices to be profitable. Shale wells deplete quickly and generate large amounts of toxic water that must be treated, eating into profits. Shale oil has made up for the lack of conventional supply, but it is not an indefinite solution.

The most optimistic calculation assumes technology will keep multiplying recoverable reserves. The pessimistic scenario starts from the premise that the energy return on extraction is falling steadily, and that injecting water under pressure to squeeze out more oil does not create more oil. Between the two extremes, global production has held steady on a plateau of more than 100 million barrels a day since before the pandemic, without economic growth returning to its previous pace.

China prepares: electric cars, coal and strategic reserves

China is not waiting for the market to solve its problem. The country is switching to electric cars en masse, powered mostly by coal-fired plants and renewables, and is stockpiling oil for strategic reserves as if there were no tomorrow. The message is clear: whoever controls energy controls the economy. Europe, by contrast, has decided to forgo new oilfields of its own and depends on imported gas, while bureaucracy and environmental permitting stall any exploration project.

The uncomfortable question left hanging is this: if scarcity is only a matter of price and infrastructure, why is the world's most powerful country attacking and seizing oil-producing regions? And why is China stockpiling reserves as if supply were about to be cut off? The answer may lie at the pumps of countries that can no longer fill their tanks.