PARIS — The International Energy Agency (IEA) announced Wednesday the release of 400 million barrels of oil from its member countries’ emergency reserves, a move intended to stabilize global energy markets disrupted by the escalating conflict in the Persian Gulf and the effective closure of the Strait of Hormuz.
The decision, exceeding the 182.7 million barrels released in 2022 following Russia’s invasion of Ukraine, comes as Iran retaliates against U.S. And Israeli strikes with attacks on commercial shipping and oil infrastructure, severely restricting oil flow through the strategically vital waterway. According to the IEA, current export volumes of crude and refined products are less than 10% of pre-war levels.
“This is a major action aiming to alleviate the immediate impacts of the disruption in markets,” said Fatih Birol, executive director of the Paris-based IEA. “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.”
The U.S. Military reported Wednesday that it destroyed 16 Iranian mine-laying vessels near the Strait of Hormuz, responding to reports of Iran deploying explosive devices in the waterway. Simultaneously, three merchant ships were struck, including a Thai-registered bulk carrier, the Mayuree Naree, which caught fire after being hit by “two projectiles of unknown origin” approximately 11 nautical miles north of Oman. The crew was evacuated by the Omani navy. A Japanese container ship, ONE Majesty, and a Marshall Islands-flagged bulk carrier, Star Gwyneth, sustained minor damage.
Iran’s Islamic Revolutionary Guard Corps has vowed to block all oil exports from the region if U.S.-Israeli attacks continue, stating it would not allow “even a single liter” to be shipped to its enemies. The conflict has prompted a significant reduction in tanker traffic, with shipping analytics firm Kpler reporting a 90% decrease in activity through the strait.
The G7 nations – Canada, the United States, France, Italy, Japan, Germany, and Britain – are contributing 70% of the total oil release, with France pledging 14.5 million barrels. President Donald Trump stated his administration would similarly tap the United States’ Strategic Petroleum Reserve to lower gasoline prices, though he did not specify the volume. Trump previously criticized the Biden administration for similar releases from the reserve.
Germany, Austria, and Japan also announced contributions to the IEA’s release. Germany will release approximately 19.7 million barrels, while Austria is releasing a portion of its emergency oil reserve and extending its national strategic gas reserve. Austria will also limit price increases at gas stations to three times per week, starting Monday.
Energy analysts offer cautious assessments of the IEA’s intervention. Maksim Sonin, an energy executive with Stanford University’s Hydrogen Initiative, suggested the release would have “a short-term stabilizing effect” but would be insufficient if the war and the closure of the Strait of Hormuz persist. Neil Crosby, vice president of oil analytics at Sparta, described the release as “a little Band-Aid,” noting the industry had largely dismissed the possibility of a prolonged closure of the strait despite the escalating conflict.
The IEA reserves, established in 1974 following the Arab oil embargo, currently comprise over 1.2 billion barrels of public emergency oil stocks, with an additional 600 million barrels held by industry under government obligation. The agency has released emergency stocks on five previous occasions, including during the 1990-1991 Gulf War and after Hurricane Katrina in 2005.
The situation in natural gas markets is also challenging, with Asia being the most severely affected region, according to the IEA. Birol noted that there are limited options to replace lost LNG cargoes from Qatar and the Emirates, resulting in a roughly 20% reduction in global energy supply.
