IEA Members Agree to Release a Record 400 Million Barrels of Oil

The International Energy Agency agreed on Wednesday to release 400 million barrels of oil from members’ strategic reserves, the largest emergency release in its history, as the war with Iran disrupts shipping through the Strait of Hormuz. Al Jazeera reported that the total is more than double the 182 million barrels released in 2022 after Russia invaded Ukraine, a figure Straight Arrow News, citing CNBC, put at 182.7 million.

Fatih Birol, the IEA’s executive director, said “the oil market challenges we are facing are unprecedented in scale,” according to Al Jazeera. Straight Arrow News reported that Birol said the release addresses the immediate effects of the disruption but that ships must resume traffic through Hormuz for a stable supply of oil and gas to return. About a fifth of the world’s oil moves through the strait, both outlets said.

The IEA has 32 member countries, Straight Arrow News reported. Al Jazeera said members hold more than 1.2 billion barrels of emergency stocks, plus another 600 million barrels of industry stocks held under government obligation. The agency was created in 1974 after the Arab oil embargo. Straight Arrow News said releases will happen on a timeline suited to member nations and gave no schedule.

Some contributions were already public. The United Kingdom said it would release 13.5 million barrels and South Korea 22.46 million, Al Jazeera reported. Germany and Austria said they would release parts of their reserves, and Japan was to begin releasing stocks on Monday, the outlet said. Al Jazeera did not report a U.S. contribution figure. Interior Secretary Doug Burgum welcomed the move on Fox News, saying it was a good time to “take some pressure off” global prices, and called the problem a temporary transit issue the U.S. is resolving militarily and diplomatically, according to Al Jazeera.

Prices have swung sharply. Al Jazeera reported that Brent crude traded at $119 a barrel earlier in the week, the first time above $100 since 2022, and was above $90 after the announcement. Brent had risen more than 25 percent since the U.S. and Israel launched the war on Feb. 28, the outlet said.

The size of the release drew caution. Analysts at Macquarie estimated that it equals roughly four days of global production, or 16 days of the crude that transits the Gulf, and said, “If that doesn’t sound like much, it isn’t,” Al Jazeera reported. The outlet said analysts argued that the pace of daily releases matters more than the total. Straight Arrow News, citing other coverage, said analysts also questioned whether the release is large enough, and noted that after the 1991 release oil prices fell more than 20 percent on the first day.

The supply picture is still tightening, according to the IEA. Al Jazeera reported that the agency said Middle East producers have begun cutting output because of limited export routes and storage, and that refinery disruptions are hurting jet fuel and diesel supply. Iran has effectively closed the strait by threatening ships and has also targeted oil fields and refineries in Gulf Arab states, the outlet said. Straight Arrow News reported that Iran threatened on Tuesday to push crude above $200 a barrel, and that President Trump wrote on Truth Social that if mines were laid and not removed, “the Military consequences to Iran will be at a level never seen before.”

G7 energy ministers met at IEA headquarters in Paris on Tuesday, Al Jazeera said, and Birol told them all options were on the table, including a release of emergency stocks.