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IEA details plan to release 120M barrels of oil over six months to cool prices

CNA – The International Energy Agency (IEA) on Thursday listed members’ contributions to a 120-million-barrel release of crude and oil products from emergency stockpiles aimed at cooling global oil prices following Russia’s invasion of Ukraine.

The release of stocks by the United States (US) allied members of the IEA, which is made up of 31 mostly industrialised countries but not Russia, would be their second coordinated release in a month and would be the fifth in the agency’s history to confront oil market disruption. It is the largest release from non-US IEA countries on top of the biggest release by the US.

Global oil prices are headed for their second weekly drop with Brent falling about USD10 to below USD100 a barrel since the US announced its largest ever oil reserve release in late March. Prices hit 14-year highs last month as Western sanctions on Russia disrupted crude and oil product exports from the world’s number two crude exporter.

The commitments made by members reached 120 million barrels to be released over a six-month period, the IEA said.

In addition to a 60 million barrels release from the US, Japan, the second biggest contributor, said it would release a record 15 million barrels.

An oil pump of IPC Petroleum France is seen at sunset outside Sommesous near Reims, France. PHOTO: CNA

Japan’s Prime Minister Fumio Kishida told reporters late on Thursday Russia’s invasion of Ukraine was “unforgivable” and the release would help curb oil prices.

“We must not forgive its invasion and war crimes. We will demonstrate our will with severe action,” he said.

Russia said its forces are conducting a “special operation” in Ukraine. Japan held about 470 million barrels of petroleum reserves at the end of January, equivalent to 236 days of domestic consumption, in state reserves, reserves held by refiners and a joint crude oil storage scheme with producing countries.

New Zealand said it would contribute crude and diesel to the IEA release.

“Our release is made up of around 184,000 barrels of crude oil held in Spain and close to 299,000 barrels of diesel held in the United Kingdom,” New Zealand’s Minister of Energy and Resources Megan Woods said in a statement.

“There has been a great deal of volatility in global oil markets since the invasion and this further action, coupled with the US move to release 180 million barrels of oil over the next six months, will help to provide some certainty to the market,” she said.