International Energy Agency members plan to deploy 400 million barrels from emergency reserves as global markets react to supply disruptions tied to the Middle East conflict.
By yourNEWS Media Newsroom
The International Energy Agency (IEA) said Wednesday it will release 400 million barrels of oil from emergency reserves, marking the largest coordinated deployment of strategic petroleum stocks in the organization’s history.
The decision comes as global energy markets face mounting pressure following disruptions linked to the ongoing war in the Middle East. Officials said the release is intended to stabilize supply and moderate rising fuel prices as shipping routes and production facilities across the region face disruption.
The Paris-based agency said the volume surpasses the previous record drawdown of 182.7 million barrels that IEA member countries released in 2022 after Russia’s full-scale invasion of Ukraine.
IEA Executive Director Fatih Birol said the market is experiencing severe strain as producers confront logistical challenges and infrastructure damage.
“Without sufficient routes to market and with no more available storage, Middle East oil producers have started to reduce production,” Birol said. “And we have seen further attacks and damage to energy and energy-related infrastructure. Refinery operations have also been disrupted, with major implications for jet fuel and diesel supplies in particular.”
IEA member nations collectively maintain more than 1.2 billion barrels of publicly held emergency oil reserves. In addition, approximately 600 million barrels are held by private industry under government stockpiling requirements.
The decision to release reserves follows a series of developments in the Persian Gulf that have disrupted energy shipments and raised concerns about global supply.
Iran has launched attacks on commercial vessels across the Persian Gulf in response to military strikes carried out by the United States and Israel. The attacks have intensified tensions in the region and contributed to a slowdown in tanker traffic through the Strait of Hormuz, one of the world’s most important oil transit routes.
Roughly one-fifth of global oil shipments normally move through the narrow waterway connecting the Persian Gulf with the Indian Ocean.
Shipping disruptions have also coincided with attacks on energy infrastructure in several Gulf Arab states. Oil fields and refineries have been targeted as part of Iran’s broader campaign to pressure the United States and Israel by affecting global energy markets.
IEA officials said that export volumes of crude oil and refined petroleum products from the region have dropped dramatically as a result of the conflict. Current export levels are estimated to be less than 10 percent of prewar volumes.
Several IEA member countries have already begun preparing releases from their strategic reserves following the agency’s decision.
Germany’s economy ministry announced that it will release 2.64 million tons of crude oil from its reserves after receiving a request from the IEA. Economy Minister Katherina Reiche said the move reflects a coordinated international effort to support energy markets.
“Germany stands behind the IEA’s most important principle of mutual solidarity,” Reiche said.
Austria also confirmed that it will release a portion of its strategic oil reserves and extend its national gas reserve to ensure domestic energy stability.
Austrian Economy Minister Wolfgang Hattmannsdorfer said the government wants to prevent price spikes from harming consumers and businesses.
“One thing is clear: in a crisis, there must be no crisis winners at the expense of commuters and businesses,” Hattmannsdorfer said.
Japan announced it will begin releasing part of its emergency reserves starting Monday as part of the coordinated action.
Energy ministers from the Group of Seven industrialized nations met Tuesday at the IEA headquarters in Paris to discuss potential responses to the market disruptions. Following the meeting, ministers said they support using strategic reserves if necessary to stabilize prices.
The G7 includes Canada, the United States, France, Italy, Japan, Germany and the United Kingdom.
Leaders from those countries were expected to hold a videoconference later Wednesday to continue discussions on energy security and supply stabilization.
Government officials in Europe have also introduced temporary regulatory measures aimed at limiting price volatility at gas stations.
Germany said it plans to introduce a rule allowing fuel retailers to raise prices no more than once per day. Officials said the measure is intended to prevent rapid fluctuations that could result from supply shocks.
Austria announced a similar measure that will limit gasoline price increases to three times per week beginning Monday.
The IEA’s emergency oil reserves were originally created in 1974 following the global energy crisis triggered by the Arab oil embargo. The system was designed to allow member nations to release oil collectively during supply disruptions.
Prior coordinated releases have occurred during several global crises, including the 1990–1991 Gulf War, the aftermath of Hurricane Katrina in 2005, the Libyan civil war in 2011, and twice during the energy market disruption that followed Russia’s invasion of Ukraine.
Birol said the current release is intended to address immediate supply shortages but emphasized that restoring stable energy markets will depend on reopening the Strait of Hormuz to normal shipping traffic.
“This is a major action aiming to alleviate the immediate impacts of the disruption in markets,” Birol said. “But, to be clear, the most important thing for a return to stable flows of oil and gas is the resumption of transit through the Strait of Hormuz.”
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