G7 energy ministers ‘ready’ to take ‘necessary measures’ on oil reserves

OIL RESERVES REPORT

The Wall Street Journal reported on Tuesday, citing officials familiar with the matter, that the IEA had proposed its largest-ever release of oil reserves to counter soaring crude prices driven by the war.

The release would exceed the 182 million barrels of oil that IEA member countries released in 2022 when Russian President Vladimir Putin invaded Ukraine, the newspaper said.

The IEA did not immediately respond to a request for comment from AFP.

The crude market has been hit by wild volatility since the United States and Israel began striking Iran at the end of last month, with Tehran retaliating by attacking targets across the oil-rich Gulf and effectively shutting down the crucial Strait of Hormuz.

Macron earlier this week spoke about the possibility of G7 countries using their emergency oil reserves to counter any extreme rise in oil prices caused by the war.

G7 finance ministers met on Monday and G7 energy ministers on Tuesday to hold talks.

Asian equities extended gains on Wednesday while oil stabilised after the WSJ report.

“We want to be ready to react at any moment,” French Finance Minister Roland Lescure, whose country holds the rotating presidency of the Group of Seven advanced economies, said on Tuesday.

The group also includes Canada, Germany, Italy, Japan, the United Kingdom and the United States.

IEA member countries currently hold over 1.2 billion barrels of public emergency oil stocks, with a further 600 million barrels of industry stocks held under government mandates.

The Paris-based IEA was created to coordinate responses to major supply disruptions after the 1973 oil crisis.

In order to ensure energy security, the IEA imposes on its members an obligation to hold emergency oil stocks equivalent to at least 90 days of net oil imports.