The International Energy Agency (IEA) has announced that its member countries will release 400 million barrels of oil from strategic reserves in a coordinated effort to stabilize global energy markets disrupted by the ongoing war involving Iran.
The decision, approved unanimously by IEA members, represents the largest coordinated emergency release in the organization’s history and only the sixth time the agency has intervened in global oil markets.
IEA Executive Director Fatih Birol described the move as a significant step aimed at easing supply disruptions caused by the conflict.
“This is a major action meant to alleviate the disruption of oil markets,” Birol said while announcing the decision on Wednesday.
Hormuz transit key to long-term stability
Despite the record release of oil reserves, the IEA stressed that restoring normal shipping operations through the Strait of Hormuz remains essential for long-term market stability.
“But to be clear, the most important thing for a return to stable flows of oil and gas is the resumption of transit through the Strait of Hormuz.” - IEA Executive Director Fatih Birol
Details regarding the exact timeline and the specific contributions from each member country have not yet been disclosed.
The emergency action follows severe disruptions in global oil trade after hostilities in the Middle East escalated, affecting shipping routes and key energy infrastructure.
Global oil prices have fluctuated sharply since the conflict began. Before the war, crude traded at around $70 per barrel, but prices surged to nearly $120 late Sunday as tensions intensified.
Following reports of the potential IEA intervention, prices dropped below $87 per barrel Tuesday night but stabilized near $90 after the official announcement.
The volatility highlights the vulnerability of global energy markets to geopolitical shocks in major oil-producing regions.
Role of the IEA in energy security
The IEA was established after the oil crisis of the 1970s to safeguard the interests of oil-consuming nations and coordinate emergency responses to supply disruptions.
Today, the organization includes 32 member countries, among them the United States, Canada, Japan, Australia and most European nations, representing roughly 80 percent of global energy demand.
Member countries are required to maintain emergency oil reserves equivalent to at least 90 days of imports, creating a buffer against major supply shocks.
The United States holds the world’s largest strategic oil reserve. Its Strategic Petroleum Reserve was last tapped in 2022 as part of an IEA response to Russia’s invasion of Ukraine, underscoring the agency’s critical role during global energy crises.
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