- This story is developing, more to follow
The International Energy Agency today unlocked 400 million barrels of oil from their reserves – the biggest such release ever – to ease the impact of the Middle East war.
‘The oil market challenges we are facing are unprecedented in scale, therefore I am very glad that IEA member countries have responded with an emergency collective action of unprecedented size,’ IEA executive director Fatih Birol said in a statement.
‘Oil markets are global so the response to major disruptions needs to be global too.’
The 32 countries at an emergency meeting ‘unanimously agreed today to make 400 million barrels of oil from their emergency reserves available to the market to address disruptions in oil markets stemming from the war in the Middle East’, the statement said.
‘The emergency stocks will be made available to the market over a timeframe that is appropriate to the national circumstances of each Member country and will be supplemented by additional emergency measures by some countries.’
The US-Israeli war with Iran has effectively closed off the Strait of Hormuz, a crucial shipping route for oil and gas.
The waterway normally sees around 20% of all oil pass through every day, but with Iran all but cutting off access to the route, prices have shot through the roof and remain volatile.
Earlier today, Iran attacked three commercial vessels in the Strait of Hormuz, including a Thailand-flagged vessel called the Mayuree Naree.
Smoke rising from the Thai bulk carrier ‘Mayuree Naree’ near the Strait of Hormuz after an attack on March 11
Making matters worse is the reneging of US president Donald Trump’s promise to provide military escorts to ensure shipments of oil continue.
Last week, he said: ‘No matter what, the United States will ensure the free flow of energy to the world.’
But yesterday, the US Navy was reported to have refused near-daily requests from the shipping industry for military escorts through the since the start of the war on Iran, saying the risk of attacks is too high for now.
It is only the fifth time in its history that the IEA has mandated a release of oil to stabilise prices, having previously done so in 1991, 2005, 2011, and twice in 2022.
The IEA release far exceeds the 182 million barrels of oil that its member countries released in 2022 when Russian leader Vladimir Putin invaded Ukraine.
The 32 members of the IEA hold over 1.2billion barrels of public emergency oil stocks, with a further 600 million barrels of industry stocks held under government mandates.
More to follow.
