A wave of "energy rationing" is sweeping across the globe.

From emerging to developed economies, all are implementing various demand-side management measures such as rationing and tax cuts to address fuel shortages and high prices.

The historic energy supply disruption triggered by the US-Israel-Iran conflict has sparked a global wave of energy rationing. From emerging to developed economies, governments are implementing various demand-side management measures—including rationing and tax cuts—to address fuel shortages and high prices. However, industry experts argue that neither tax cuts nor rationing can provide lasting relief; they fail to address the underlying risks, ensure stable supply, and may even exacerbate the already fragile economic situation.

Several Asian countries have imposed restrictions on fuel consumption.

The Asian aviation sector was the first to take action. In March, Myanmar Airlines canceled some domestic flights to prioritize the use of its limited aviation fuel for international routes; Vietnam Airlines reduced its domestic flight operations by 23 flights per week; Malaysia's Badik Airlines cut its domestic capacity by 36%; Pakistan even advised pilots to carry extra fuel back from international flights; meanwhile, airports in several countries began imposing restrictions on the amount of fuel allowed for refueling on international flights.

Reuters reported that global crude oil supply has decreased by at least 20% since the outbreak of the conflict between the United States, Israel, and Iran.

Data compiled by shipping analytics firm Kepler shows that as of mid-March, the U.S.-Israel-Iran conflict has resulted in a cumulative crude oil production loss of 133 million barrels. If the conflict persists, the previously released crude oil reserves would offset the loss.

In the first week of April, Indonesia implemented a fuel rationing system, limiting daily fuel purchases for private vehicles to no more than 50 liters and requiring civil servants to work from home to conserve energy reserves. Bangladesh also introduced rationing measures, as the country relies on imported energy for 95% of its needs. Sri Lanka introduced a fuel registration system in mid-March and began restricting water supply and raising electricity prices to address the energy crisis. Myanmar controlled fuel access through fixed weekly quotas, while India and Thailand reduced industrial gas consumption to prioritize basic household needs.

The EU seeks to gain control over energy demand

Meanwhile, the European Union (EU) could no longer withstand the pressure. On April 13, European Commission President Ursula von der Leyen publicly stated that the US-Israel-Iran conflict had significantly impacted the EU economy, and the Commission would introduce a series of measures to address rising energy prices and supply disruptions. "We should reduce demand while fully respecting consumers' freedom of choice," she emphasized.

European media interpreted this statement as the EU's plan to tackle the current energy crisis through "demand disruption." Bloomberg noted that "demand disruption" is a concept deeply feared by the oil and gas industry, viewed as a last resort. This includes both government-led "intentional" demand disruption and market-driven "spontaneous" demand disruption, both of which would have economic repercussions.

Slovenia has become the first EU member state to implement fuel rationing. According to BBC News, Slovenia has set a daily maximum fuel purchase limit of 50 liters for private vehicles, with 200 liters allocated for businesses and agriculture. Additionally, the country is encouraging fuel retailers to impose stricter fuel purchase restrictions on foreign drivers.

Germany has approved legislation to curb fuel price increases, permitting gas stations to raise prices once daily. Since the outbreak of the US-Israel-Iran conflict, diesel prices in Germany have risen from approximately €1.75 per liter to over €2.

Poland announced measures to reduce fuel taxes and implement price controls, lowering the value-added tax (VAT) on gasoline and diesel from 23% to 8%, while reducing the fuel consumption tax to the minimum level permitted by EU regulations and imposing daily maximum price caps on refined oil products.

The Czech Republic has set an upper limit on profit margins for fuel retailers and reduced the diesel consumption tax, while releasing 100,000 tons of crude oil reserves to maintain refinery operations. Romania, on the other hand, cut the diesel consumption tax through an emergency decree.

The Financial Times reported that amid supply shortages, the European Union is considering rationing as an option to curb energy demand. EU Energy Commissioner Dan Jørgensen stated, "This will be a prolonged crisis, with energy prices remaining high for an extended period; both fuel rationing and reserve releases should be taken into account."

The UK may reintroduce quantitative rationing

European countries outside the EU are also unable to remain unscathed. The Norwegian Parliament approved temporary reductions in gasoline and diesel taxes from April 1 to September 1 to address soaring energy prices. Norwegian Finance Minister Jens Stoltenberg stated that the temporary measures would result in a loss of at least 3.3 billion Norwegian kroner in national fiscal revenue.

Nick Butler, a visiting professor at the King's College London Policy Institute and former energy affairs expert at Downing Street, warned that crises such as gasoline rationing, drug shortages, and empty supermarket shelves are imminent, signaling that "some form of rationing" will return to the UK.

Currently, diesel and gasoline prices in the UK have risen by 27% and 14% respectively compared to levels before the outbreak of the conflict in the US-Israel-Iran region, with a diesel shortage expected to emerge as early as the end of April.

The U.S. International Finance Times noted that the UK's energy crisis has escalated sharply, necessitating fuel rationing for aviation fuel and diesel. The UK's gasoline supply primarily comes from the United States and Norway, while diesel relies heavily on global trade and the Middle East. In response to the supply chain crisis, the UK government has established a national fuel emergency plan, outlining specific rationing measures and ensuring priority fuel supplies for critical sectors such as ambulances and food transportation.

Data from the Royal British Automobile Club shows that in the last week of March, the average diesel price in the UK reached 182.8 pence per liter, up 40 pence since the outbreak of the US-Israel-Iran conflict. In the first week of April, European diesel futures prices surpassed the $200 per barrel mark.

"In the short term, we must assess existing supplies and prioritize critical sectors, including healthcare services, food supply, and hospital systems," emphasized Nick Butler. "If the situation deteriorates further, the allocation of remaining resources will be determined by the government."

The UK energy regulator, the Office of Gas and Electricity Markets, sets energy price caps based on the average wholesale prices over a three-month period. According to its established price cap for July to September, the annual bill for an average UK household will amount to £1,801.

BlackRock, a leading U.S. investment management firm, warned that if international oil prices surge to $150 per barrel, Europe would face unavoidable energy shortages, plunging the global economy into a prolonged recession.