The International Energy Agency (IEA) will release 400 million barrels of strategic petroleum reserves, and Trump has authorized the U.S. Department of Energy to release 172 million barrels of crude oil—what impacts will this have?

Around 11 p.m. last night, I noticed the 10-year U.S. Treasury yield surged to 4.2%, the U.S. dollar index spiked to around 99.6, and both gold and silver prices fell—so I guessed the conflict was highly likely escalating, with risk-averse capital once again flowing into the U.S. dollar. Then, at around 11:20 p.m., the IEA announced the release of 400 million barrels of strategic petroleum reserves (SPR)—including the aforementioned 172 million barrels—to increase crude supply in the market and suppress oil prices. Yet this move had already been priced in by the market; following the announcement, crude prices rose instead—by 6%. The IEA’s two dozen member countries collectively hold 1.24 billion barrels of crude oil in reserve. Deciding how much to release at once is no trivial matter—and undoubtedly required extensive deliberation among IEA members. Releasing too little would be ineffective; releasing too much, however, would leave insufficient reserves should the Strait of Hormuz remain blocked long-term—given Iran’s current stance of fighting to the end. Today’s headlines sound impressive: “IEA Unveils Largest-Ever Release of Oil Reserves.” But before long, those headlines may shift to: “IEA Oil Reserves Fully Depleted”—and if such a headline goes viral, it could trigger far greater global panic. Hostilities are still intensifying. Though Trump declared victory, both Israel and Iran are escalating their military engagement with growing fervor. Any further IEA releases of crude reserves will likely exert minimal downward pressure on oil prices going forward—because everyone knows these reserves are finite, and will run out quickly. How quickly? I calculated this a few days ago—and updated the figures today. According to the latest Wall Street Journal report, Iran continues exporting 2 million barrels per day despite the war. A question many are asking: Where are these exports going? I’ve noticed numerous domestic media outlets avoid addressing this directly—citing only the first half of the WSJ report while omitting its latter half, which identifies the destinations. Personally, I see no reason to conceal this. After all, historically 90% of Iran’s crude exports went to ‘Old Zhong’ (a colloquial term for China); continuing sales to China is perfectly normal. You wage your war—I carry on with my life and keep buying oil. That seems entirely reasonable to me—nothing controversial about it. Those interested can read the full article. Moreover, after cross-checking multiple sources, it appears that currently, the vessels still able to transit the Strait of Hormuz are either Iranian or Chinese. Regarding the figure of 2 million barrels per day: I compared it with data from other institutions. Last year—during peacetime—Iran’s average daily export stood at 1.6 million barrels. So the claim that Iran is now exporting 2 million barrels daily appears plausible. Let’s do the math: The IEA holds a total of 1.24 billion barrels. At a daily depletion rate of 20 million barrels, and assuming the lifting of Russian sanctions adds 4.5 million barrels per day, while subtracting Iran’s ongoing 2-million-barrel-per-day exports, the global daily crude shortfall stands at 13.5 million barrels. How many days can the IEA’s entire 1.24-billion-barrel stockpile cover? 1.24 billion ÷ 13.5 million = 92 days

Why did international oil prices surge—again breaching $100 per barrel—despite the coordinated release of 400 million barrels of emergency oil reserves by 32 countries under the IEA?

Executive Summary: On March 12 (Thursday), the International Energy Agency (IEA) announced that its 32 member countries would jointly release 400 million barrels of strategic petroleum reserves—the largest such coordinated release in history. Yet rather than falling, international oil prices surged again, briefly breaking above $100 per barrel. Three main factors drove this counterintuitive reaction: mounting market fears over a prolonged closure of the Strait of Hormuz; the fact that the pace of reserve releases falls far short of daily supply disruptions; and escalating attacks on vessels in the Persian Gulf, intensifying supply-side panic. In the medium to long term, should the conflict ease, oil prices could still retreat toward the $80-per-barrel level. I. International oil prices surged sharply on Thursday, again breaching $100 per barrel. On March 12 (Thursday), global oil prices surged sharply once more. At 11:30 a.m., Brent crude briefly broke above $100 per barrel—reaching a high of $101.38—up 10.2% from Wednesday’s close. Prices began retreating only around noon, falling to $96.32 per barrel by 4:00 p.m.—still up 4.7% from Wednesday’s close. This marks the second time oil prices have breached $100 since the outbreak of the Iran war. Since February 28, when the U.S. and Israel launched air strikes against Iran, global oil markets have experienced extreme volatility. The first $100 breach occurred this past Monday (March 9), when Brent crude opened sharply higher, surging past $100 and approaching $120—peaking at $119.50, the highest level in three years. In the early hours of March 10 (U.S. Eastern Time, late afternoon on March 9), President Donald Trump told reporters in an interview that the Iran war was “very decisive—a necessary action we had to complete—and we’re nearly done.” His remarks implied that this 10-day Middle East conflict might be nearing its end, while also warning that intensified strikes would follow if critical oil routes were disrupted. Consequently, international oil prices plunged 11.3%, falling to $87.80 per barrel. II. Why did the IEA’s record-breaking 400-million-barrel release fail to curb rising oil prices? On March 11, the IEA announced that its 32 member countries had reached a “unanimous decision” on Wednesday to inject 400 million barrels of crude oil from strategic reserves into the market—to mitigate the economic impact of the U.S.-Israeli war against Iran. This constitutes the largest coordinated release in the IEA’s history. IEA Executive Director Fatih Birol stated: “The challenge we face in the oil market today is unprecedented. Therefore, I am deeply encouraged that IEA member countries have taken collective emergency action on such a scale… Energy security is the IEA’s founding mission, and I am delighted to see the strong unity demonstrated by member countries as they take decisive measures.” Citing informed officials, the Wall Street Journal noted that this release is unparalleled in IEA history: the 400-million-barrel volume is more than double the 182 million barrels IEA members sold onto the market following Russia’s 2022 invasion of Ukraine. To date, this marks the sixth time the IEA has coordinated a joint release of strategic petroleum reserves among its members. Established in 1974, the IEA comprises 32 member countries—including the United States, the United Kingdom, France, Germany, Japan, and South Korea. It requires members to maintain strategic petroleum reserves equivalent to no less than 90 days of net petroleum imports from the previous year, and authorizes the use of these reserves to stabilize international markets during severe global supply disruptions.

IEA says total oil stock release will exceed 400 million barrels

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The IEA announced total oil stock releases will exceed 400 million barrels, with members committing to expedite the remaining 100 million barrels, including over 20 million barrels of diesel.

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