Canada and 31 other nations agreed Wednesday to release a combined 400 million barrels of oil from their strategic reserves, a move coordinated by the International Energy Agency (IEA) in response to escalating global energy market disruption caused by the ongoing war in Iran.
The unprecedented release, representing the largest coordinated emergency oil stockpile release in the IEA’s history, aims to counter surging crude prices and stabilize global supply. The IEA’s 32 member countries, comprised of advanced economies in Europe, North America, and northeast Asia, are participating in the effort. The United States will contribute 172 million barrels, according to the Department of Energy.
“The conflict in the Middle East is having significant impacts on global oil and gas markets, with major implications for energy security, energy affordability and the global economy,” IEA Executive Director Fatih Birol stated. “I can now announce that IEA countries have unanimously decided to launch the largest-ever release of emergency oil stocks in our agency’s history.”
The decision follows Iran’s escalating attacks on commercial ships in the Persian Gulf and threats to disrupt oil traffic through the Strait of Hormuz, a critical waterway for global oil shipments. Iran has effectively halted cargo traffic through the Strait, through which approximately 20 percent of all oil is shipped from the Persian Gulf toward the Indian Ocean, and has also targeted oil fields and refineries in Gulf Arab nations. These actions are intended to generate economic pressure on the United States and Israel to cease their military operations.
Germany and Austria announced Wednesday they would release portions of their oil reserves following the IEA’s request. Japan indicated it would commence releasing its oil stockpiles as early as next week.
IEA members collectively hold more than 1.2 billion barrels of public emergency oil stocks, with an additional 600 million barrels held by industry under government obligation. The IEA did not specify a timeline for the release of the 400 million barrels, stating that reserves would be released “over a time frame that is appropriate to the circumstances of each of its 32 member countries.”
The current crisis builds on previous emergency releases. In 2022, the IEA’s member countries released 182.7 million barrels in response to Russia’s invasion of Ukraine. The IEA was founded in 1974 following the oil embargo imposed by Arab producers during the 1973 Arab-Israeli war, and is tasked with maintaining global energy security.
Despite the coordinated release, oil prices have continued to rise. Refinery operations have also been disrupted, with major implications for jet fuel and diesel supplies, according to the IEA. Birol emphasized that a “return to stable flows of oil and gas is the resumption of transit through the Strait of Hormuz.”
