IEA member countries committed to releasing 61.7 million barrels of oil reserves as of March 4, exceeding the 60 million barrels of oil that they had pledged to release from emergency stocks to bring stability to energy markets.
The International Energy Agency said its members were ready to release more oil into the market “if needed” to tackle soaring prices in the wake of Russia’s war in Ukraine. Members including the US and its allies are discussing a further coordinated release of oil from storage to tackle rising prices.
IEA member countries committed to releasing 61.7 million barrels of oil reserves as of March 4, exceeding the 60 million barrels of oil that they had pledged to release from emergency stocks to bring stability to energy markets. The US will provide 30 million barrels followed by Japan with 7.5 million, South Korea with 4.4 million, Germany with 3.2 million and the UK with 2.2 million.
IEA Executive Director Fatih Birol said: “Our member countries and secretariat are closely monitoring the markets and in addition to the initial release if our member countries decide, we are immediately ready to act and release additional volumes to the market. The earlier release constituted just 4% of the total storage. If our countries decide [that] there is a need, we will be happy to immediately act and bring the volumes to the market.” Of its 31 member countries, Russia is not a member.
Member countries were unanimous that Russian oil and gas imports should be “radically” reduced, Birol added. “Different policies, different measures, different timelines but one single target — reducing radically Russian oil and gas imports.”
Oil prices eased slightly following the comments. Brent, the global benchmark for two-thirds of the world’s oil, dropped 2.15 percent to trade at $119 a barrel at 7.57 pm UAE time on Thursday, while West Texas Intermediate, the gauge that tracks US crude, was trading 1.96 percent lower at $112.70 a barrel.
US domestic supplies will increase by 1 million barrels per year following calls by President Joe Biden to oil companies to ramp up production to offset Russian imports.
Russia is the world’s second-largest energy exporter. It accounts for about 10% of the world’s energy output, including 17% of its natural gas and 12% of its oil. It supplies about 40% of Europe’s gas, while Russian crude accounts for about 3% of US oil imports, equal to about 200,000 barrels a day. The US banned Russian oil imports earlier this month, while the EU is considering similar measures.
Read more about Russia’s invasion of Ukraine and what it means for Energy in Europe.