Oil prices have not yet reflected the severity of the unprecedented supply crisis caused by the conflict involving Iran, but they will soon, according to Fatih Birol, the Executive Director of the International Energy Agency (IEA).

Birol stated at an event hosted by the Atlantic Council that the conflict, along with the near closure of the Strait of Hormuz, has halted approximately 13 million barrels per day of supply.

He warned that more than 80 energy facilities have been damaged during the hostilities, and the recovery process could take up to two years. The Paris-based agency had previously described the current supply disruption as the most severe in history.

"Prices are already high, but they do not reflect the seriousness of the problem—I agree there is a disconnect," Birol said. "However, I believe we will soon see the two converge, and this is an extremely sensitive issue for the global economy."

Crude oil futures in London are trading near $100 per barrel, representing an increase of approximately 64% since the beginning of the year. However, prices remain significantly below the levels reached after Russia's invasion of Ukraine in 2022 and also below the record highs set in 2008.

Last month, IEA member countries including the United States, Japan, and Germany agreed to an unprecedented release of emergency petroleum reserves to help cool the market.