Germany and Austria have announced they will release parts of their oil reserves following a request from the International Energy Agency (IEA) for its member countries to release 400 million barrels collectively. This move aims to mitigate energy price spikes resulting from the ongoing conflict in Iran. Japan has also stated that it will begin releasing some of its reserves starting Monday.
The largest previous collective release of emergency oil stocks by IEA member countries occurred in response to the energy shock caused by Russia’s full-scale invasion of Ukraine in 2022, which totalled 182.7 million barrels. Presently, IEA members hold over 1.2 billion barrels of public emergency oil stocks, in addition to 600 million barrels of industry stocks mandated by government regulations.
In reaction to US and Israeli strikes, Iran has launched attacks on commercial ships in the Persian Gulf, escalating efforts to exert pressure on the oil-rich region amid growing global energy concerns. Iran has effectively halted cargo traffic in the narrow Hormuz Strait, a critical passage through which about one-fifth of all oil shipments from the Persian Gulf travel toward the Indian Ocean. Additionally, the country has targeted oil fields and refineries in Gulf Arab countries, aiming to inflict enough global economic pain to compel the United States and Israel to cease their military actions.
On Tuesday, G7 energy ministers expressed their support for proactive measures to address the situation, including the potential use of strategic reserves. According to the IEA, the current export volumes of crude and refined products are less than 10% of pre-war levels.
India, as an Associate Member of the IEA and an active participant in international energy cooperation, welcomed the IEA’s decision to release emergency oil stocks in response to the current supply disruptions. The government of India declared its readiness to take appropriate measures to support global market stability, in line with the IEA’s efforts.
This article used information from The Associated Press.
