The International Energy Agency agreed on October 15 to speed up the remaining releases from an emergency oil-stock action launched in March, including more than 20 million barrels of diesel as soon as possible. The March action was launched in response to the Strait of Hormuz crisis.
About 330 million barrels have already been released, according to the IEA Governing Board’s statement. Members agreed to complete roughly 100 million barrels still outstanding, subject to their national circumstances. Because some countries released more than they originally pledged and others intend to do so, the total will exceed the original commitment of 400 million barrels.
Why diesel is the priority
The IEA said oil markets remain tight, particularly for diesel. It encouraged member countries with oil production or refining capacity to increase supplies of crude and refined products while keeping energy trade flowing freely.
Reuters reported that diesel prices have reached record highs in many markets as the conflicts in the Middle East and Ukraine disrupt supplies. The 32-country agency coordinates releases from emergency reserves held by industrialized economies.
The release stops short of an earlier proposal
The planned diesel release is smaller than a 50 million-barrel figure discussed earlier under a French proposal, Reuters reported. Europe’s benchmark gasoil contract, which includes diesel, ticked higher after the announcement, though it remained lower on the day. Saxo Bank analyst Ole Hansen said the move suggested some disappointment that members had not committed to releasing additional barrels beyond the current action.
