The 32-member International Energy Agency has unanimously agreed to release 400 million oil barrels from its global strategic reserves in an attempt to prevent supply disruptions and ease market fears caused by Iran war shortages.
The International Energy Agency (IEA) said on Wednesday that its member countries have agreed to release 400 million barrels of oil in response to the Iran war, the largest emergency distribution in history and more than double the delivery after the Russian invasion of Ukraine.
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“The oil market challenges we are facing are unprecedented in scale, therefore I am very glad that IEA member countries have responded with an emergency collective action of unprecedented size,” said IEA executive director Fatih Birol.
“Oil markets are global so the response to major disruptions needs to be global too. Energy security is the founding mandate of the IEA, and I am pleased that IEA members are showing strong solidarity in taking decisive action together.”
The decision is an attempt to bring down oil prices as the Iran crisis and the consequent disruption of shipments through the Strait of Hormuz continue to inflict massive shocks to energy markets.
The release timeframe will vary by each member country's national circumstances, with further implementation details to follow.
The quantity agreed upon represents roughly 20 days of oil flows through the Strait of Hormuz, which on average would have 20 million barrels crossing daily.
During a meeting of the G7 members held via video conference, French President Emmanuel Macron said that an increase in global oil production is a priority going forward and that barriers to exports should be minimal.
"I want to engage with third parties to avoid any type of export restrictions for oil and gas which could destabilise the market and create more volatility," Macron emphasized.
The G7 also discussed sanctions on Russia and Macron stated that the countries agreed that "the situation does not justify lifting any sanctions".
Last week, US Treasury Secretary Scott Bessent announced a 30-day waiver allowing Indian refiners to purchase Russian oil from ships currently stranded at sea, with the measure expiring on 4 April and not applying to any new shipments.
The waiver applies to oil already at sea and is not a broad sanctions relaxation, with Bessent describing it as a "deliberately short-term measure" that would not provide significant financial benefit to Russia.
A united G7 front
Ahead of this announcement, Germany and Austria had already stated they would release parts of their oil reserves following the IEA's request.
Likewise, Japan also said it would release some of its reserves starting next Monday.
Germany and Japan are members of the Group of Seven, or G7, an intergovernmental economic forum that also includes the US, the UK, Italy, Canada and France, and which held emergency talks over the past two days on surging oil prices.
The G7 did not immediately agree to release reserves itself.
Instead, it asked the IEA to assess the situation and draw up options for a coordinated release of strategic stocks.
The IEA subsequently convened an extraordinary meeting of its 32 member governments to decide whether to act.
It is that meeting that has produced the agreement on the 400 million barrels now expected for release.
The G7's role was political in setting the direction and asking for a plan. The IEA's role is technical, in terms of formally approving and coordinating a release that actually results in oil flowing into the market.
The announcement came as Brent crude, the international benchmark, remained around 20% higher than when the war began, despite falling well below Monday's peaks.
Consumers around the world are already feeling the impact at the pump.
The largest previous collective release of emergency stocks by IEA member countries was 182.7 million barrels, following the energy shock triggered by Russia's full-scale invasion of Ukraine in 2022.
IEA members currently hold over 1.2 billion barrels of public emergency oil stocks, with a further 600 million barrels of industry stocks held under government obligation.
G7 energy ministers on Tuesday announced they supported in principle "the implementation of proactive measures to address the situation, including the use of strategic reserves," setting the stage for Wednesday's coordinated response.
In reaction to US and Israeli strikes, Iran has attacked commercial ships across the Persian Gulf, escalating a campaign to squeeze the oil-rich region as global energy concerns mount.
Iran has effectively halted cargo traffic through the Strait of Hormuz, meaning around a fifth of all oil is currently not shipped from the Persian Gulf toward the Indian Ocean.
The US military said on Tuesday it had destroyed 16 Iranian minelayers near the strait, though President Donald Trump said in social media posts that there were no confirmed reports of Iran mining the passage.
If the strait were to be mined, experts say it could take at least several weeks to clear once the conflict ends.
Dark fleets?
Despite the disruption, some traffic is continuing.
Security firm Neptune P2P Group said on Wednesday that seven ships had passed through the strait since 8 March, five of them linked to Iranian-associated shipping.
In ordinary times the strait typically sees more than 100 ships transit daily.
Some tankers are making so-called "dark" transits — turning off their Automatic Identification System trackers, a practice commonly associated with vessels carrying sanctioned Iranian crude.
Commodity-tracking firm Kpler said Iran had meanwhile restarted crude exports through its Jask oil terminal on the Gulf of Oman, with a tanker loading roughly 2 million barrels at the terminal on 7 March — suggesting Tehran retains some capacity to route oil around the strait.
Tehran has also targeted oil fields and refineries in Gulf nations, aiming to generate enough global economic pain to pressure the United States and Israel to end their strikes.
According to the IEA, export volumes of crude and refined products are currently at less than 10% of pre-war levels.
