The International Energy Agency (IEA) is set to recommend the release of 400 million barrels of oil, the largest such move in the agency’s history, in an effort to curb soaring crude prices driven by the US-Israeli war with Iran. Sources said the release would be spread over at least two months, with countries allowed up to 90 days to distribute their share.
The Paris-based IEA is expected to publish its recommendation later Wednesday, ahead of a G7 summit chaired by French President Emmanuel Macron. Germany’s Economy Minister, Katherina Reiche, confirmed the 400 million barrel figure, stating that her country would participate, while the United States and Japan would provide the largest contributions. The IEA did not immediately respond to requests for comment.
Japan moved quickly to act ahead of the IEA recommendation. Prime Minister Sanae Takaichi announced that the country would release 15 days’ worth of private-sector reserves and one month of state reserves, starting as early as March 16. “Rather than wait for formal IEA approval of a coordinated international reserve release, Japan will act first to ease global energy market supply and demand,” she said.
The proposed release would more than double the previous record set during the Ukraine crisis. In 2022, IEA member countries released 182.7 million barrels of oil in response to Russia’s full-scale invasion of Ukraine, marking the largest release at that time. “During the war in Ukraine, they were talking about releasing around 182 million barrels, and now it’s an amount that is more than double their proposal,” said Spain’s Energy Minister Sara Aagesen.
The IEA, formed after the 1970s oil crisis, coordinates strategic oil stockpiles among Western economies to stabilise markets in times of crisis. G7 energy ministers expressed support for the measure, noting that proactive use of strategic reserves was justified even though no country currently faces a physical shortage of crude. A G7 source told Reuters that “prices were rising sharply, and leaving the situation unattended was not an option.”
Details on allocations and timing are still under discussion, with the IEA secretariat expected to propose different scenarios based on market impact. Outreach to non-IEA members, including China and India, is also anticipated. South Korea is reviewing its position, according to a spokesperson for the country’s industry ministry.
Oil prices rebounded on Wednesday as markets weighed the potential impact of the IEA’s reported plan against ongoing supply disruptions caused by the Iran conflict. Brent crude and West Texas Intermediate futures rose as investors assessed whether the unprecedented reserve release would be sufficient to stabilize global energy markets.
The record IEA recommendation highlights the urgency felt by Western economies to manage crude supply and limit the economic fallout from heightened tensions in the Middle East, which continue to drive volatility in energy markets worldwide.
