Energy Agency Members Agree to Speed Remaining Emergency Oil Release, Including Diesel
The member countries of the International Energy Agency, the United States among them, agreed to speed up the remaining roughly 100 million barrels of their emergency oil-stock release, including more than 20 million barrels of diesel as soon as possible.
The governing board of the International Energy Agency, the Paris-based body through which the United States and other major oil-consuming countries coordinate emergency fuel supplies, agreed to speed up the rest of its emergency oil release.
Member countries have already released about 330 million barrels from government stockpiles since March. They agreed to complete the remaining roughly 100 million barrels in a timely way and to speed those releases, including more than 20 million barrels of diesel as soon as possible. Some countries have released more than they pledged and others plan to, so the total will pass the 400 million barrels promised in March.
Diesel moves trucks, trains, farm machinery and ships, so its price feeds into the cost of moving food and goods. The board said the agency's latest assessments point to continued tightness in oil markets, notably for diesel.
The board also urged member countries that produce and refine oil to pump and process more, especially diesel, and stressed keeping energy trade flowing freely. Member governments still hold about 1.1 billion barrels in public emergency stocks.
Paris — The member countries of the International Energy Agency agreed to speed the remaining part of their emergency oil-stock release, including more than 20 million barrels of diesel to be put on the market as soon as possible.
The agency is the organization through which the United States, Japan, most of Europe and other large oil-consuming nations hold emergency stockpiles and agree when to release them. Its governing board is made up of representatives of the member governments.
Members have released about 330 million barrels so far under a collective action they launched in March in response to the crisis in the Strait of Hormuz, the narrow sea passage at the mouth of the Persian Gulf through which a large share of the world's oil normally travels. The board agreed to "take all necessary steps" to complete the roughly 100 million barrels still outstanding in a timely way, consistent with each country's circumstances, and to accelerate those releases with specific plans already in place, including the diesel. Because some members have released more than they first pledged and others intend to, the total will exceed the 400 million barrels promised in March.
The board said the agency's staff assessments point to continued tightness in oil markets, "notably for diesel." Diesel is the fuel of the freight economy: it powers most trucks, freight trains, farm equipment, construction machinery and ships, so when it costs more, so does moving food and goods.
The board also encouraged member countries that produce crude oil or run refineries to increase output of both crude and refined fuels, especially diesel, and "underlined the importance of the free flow of energy trade." The board said it was willing to take further action, building on an October 2 statement by the Group of Seven, the leading industrial democracies including the United States. The agency's staff will keep tracking progress, report to G7 leaders, and advise the board on whether more action is needed after an updated market assessment focused on diesel.
The barrels come from strategic reserves, fuel that governments, and in some countries required private companies, hold in storage for emergencies. In the United States that reserve is the Strategic Petroleum Reserve, kept in salt caverns along the Gulf Coast in Texas and Louisiana. After an earlier meeting on October 7, the agency said member governments still hold about 1.1 billion barrels in public emergency stocks, including more than 200 million barrels of diesel, and stand ready to release more if needed.