IEA agrees record release of 400mn barrels from emergency oil reserves to counter Gulf War impact

The International Energy Agency (IEA) agreed on March 11 to release 400mn barrels of oil from its members' emergency reserves, the largest such release in the organisation's history, as the war in the Middle East drives energy prices sharply higher, the Associated Press reported.

Tehran has also targeted oil fields and refineries across Gulf Arab states in an effort to generate sufficient economic pressure on the United States and Israel to halt their strikes on Iran.

The Paris-based body said the release exceeds the 182.7mn barrels made available in 2022 by the IEA's 32 member countries following Russia's full-scale invasion of Ukraine.

IEA member countries currently hold over 1.2bn barrels of public emergency oil stocks, with a further 600mn barrels of industry stocks held under government obligation.

"Without sufficient routes to market and with no more available storage, Middle East oil producers have started to reduce production," IEA Executive Director Fatih 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."

Iran has effectively halted cargo traffic through the Strait of Hormuz, through which around a fifth of all globally shipped oil passes from the Persian Gulf toward the Indian Ocean.

As bne IntelliNews reported, Iran has reportedly sent more than 11 million barrels of oil through the Strait of Hormuz since the war began, all bound for China, citing shipping data.

Shipping through the Strait of Hormuz remains mostly suspended, but vessel-tracking data shows a slight uptick in Iran- and China-linked traffic, including two sanctioned VLCCs fully loaded with crude.

US President Donald Trump boasted that he would reopen traffic by providing a naval escort. However, the Wall Street Journal reported that the US navy has been getting daily requests for US naval protection from shipping companies on a daily basis since the conflict began and has been turning them all down as it considers the passage through the straits too dangerous.

Trump also claimed that the Persian navy has been destroyed. However, the IRGC released a video showing underground naval tunnels packed with fast-attack boats, anti-ship missiles, and naval mines. Iran also has an extensive fleet of submarines including three advanced Russian-made Kilo class submarines none of which have been reportedly damaged so far.