FRANKFURT, Germany (AP) – The 31 member countries of the International Energy Agency agreed to release 60 million barrels of oil from their strategic reserves – half of that amount coming from the United States – “to send a strong message to oil markets” that there will be no “shortage of supplies” after Russia invaded Ukraine, the group announced on Tuesday.
The IEA’s board, based in Paris, made the decision at an extraordinary meeting of energy ministers chaired by U.S. Energy Secretary Jennifer Granholm, who noted in a statement that President Joe Biden approved a commitment of 30 million barrels and that the United States is prepared to “take additional steps” if needed.
The group’s decision “reflects our shared commitment to addressing market and supply disruptions related to President Vladimir Putin’s war in Ukraine,” Granholm said.
Russia plays a significant role in global energy markets as the world’s third-largest oil producer. Its exports of about 5 million barrels of crude per day account for roughly 12% of world oil trade. About 60% of that volume goes to Europe and another 20% to China.
So far, sanctions imposed by the United States and Europe have not barred oil or gas exports and have included exemptions for transactions to pay for crude and gas. Western leaders are reluctant to curb Russian oil exports at a moment when global energy markets are tight and high prices are fueling inflation in developed economies.
Yet the invasion has already unsettled markets worldwide. On Tuesday, oil prices rose, with the U.S. benchmark crude topping $100 a barrel, the highest price since 2014.
“The situation in energy markets is very grave and requires our full attention,” said Fatih Birol, the IEA’s executive director. “Global energy security is under threat, placing the world economy at risk during a fragile recovery.”
In addition to the United States, other members of the organization are: Germany, France, the United Kingdom, Japan and Canada. IEA members hold emergency reserves of 1.5 billion barrels of oil. The release represents 4% of the reserves, or about 2 million barrels per day for 30 days.
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