The International Energy Agency is in talks with governments in Asia and Europe about releasing additional amounts of oil from reserves “if necessary” because of the conflict in Iran, IEA Executive Director Fatih Birol said on Monday, Reuters quoted.
“If necessary, of course we will do so. We will look at the situation, assess the markets and talk to member countries,” Birol told the National Press Club in Canberra.
IEA member countries agreed on March 11 to release a record 400 million barrels of oil from strategic reserves amid rising global crude prices. The discount represented 20% of the total stocks.
There would be no specific crude price level that would trigger another release, Birol said.
“A release of stocks will help calm the markets, but that is not the solution. It will only help mitigate the negative effects on the economy,” said Fatih Birol.
The worst energy crisis in recent decades
At the same time, the head of the IEA warned that the world could face “the worst energy crisis in decades” due to the war in the Middle East. He described the crisis as worse than the two oil shocks of the 1970s, as well as the impact of the war between Russia and Ukraine on gas, combined.
“To date, we've lost 11 million barrels a day, more than the two major oil crises combined. At the time, in each of those crises, the world lost about five million barrels a day, so putting them both together, 10 million barrels a day,” Boirol said, referring to the crises of the 1970s.
“The most important solution to this problem is opening the Strait of Hormuz,” he said.
