The International Energy Agency has ordered the largest release of government oil reserves in its history, with 400 million barrels of emergency crude to be made available to calm markets disrupted by the US-Israeli attacks on Iran. The unanimous decision by the IEA's 32 member countries far exceeds the previous record of 182 million barrels released in 2022 after Russia's invasion of Ukraine.
IEA Executive Director Fatih Birol said: "Oil markets are global so the response to major disruptions needs to be global too. Energy security is the founding mandate of the IEA, and I am pleased that IEA members are showing strong solidarity in taking decisive action together." The release represents about a third of the group's total government stockpiles and will cover roughly 26 days of crude normally shipped via the Strait of Hormuz, where trade has been halted by attacks from Iran's Islamic Revolutionary Guard Corps.
Japan, which relies on the Strait of Hormuz for about 70% of its oil imports, will release around 80 million barrels from 18 March. Germany will contribute 19.51 million barrels, with Economy Minister Katherina Reiche stating: "We will comply with this request and contribute our share, because Germany stands behind the IEA's most important principle: mutual solidarity." The UK has promised 13.5 million barrels from its emergency stocks, held at refineries, terminals, power stations and offshore fields in the North Sea, with about 15% stored overseas in the Netherlands, Belgium and Germany.
Despite the intervention, Brent crude oil prices rose by 4.4% to $91.7 a barrel. The global market has lost around 15 million barrels of crude a day due to the blockade, and 13 ships have come under attack since the war began, including three on Wednesday. Iran's military has warned that oil could hit $200 a barrel.
The IEA was created in the 1970s in response to the oil crises, and this is only the fifth time its members have triggered emergency releases. The UK government is also considering support schemes for households and businesses hit by the surge in energy prices, with a price cap in place until July.
