The finance ministers of the G7 will discuss the possibility of releasing oil from storage in response to the price rally resulting from the war in the Middle East, media, including the Financial Times and the Australian Financial Review, have reported, citing unnamed sources.
The emergency meeting of the officials, also involving the head of the International Energy Agency, will take place later today, with plans under consideration including the amount of 300 to 400 million barrels.
The volumes mentioned in the reports prompted a selloff in oil, with Brent crude and WTI shedding some of their latest gains. The two are still trading above $100 a barrel, however. The volumes to be discussed are significantly higher than the amount that the IEA released back in 2022 after the price spike following Russia’s incursion into Ukraine. At the time, the IEA coordinated a release of 240 million barrels, with half of that coming from the United States, InvestingLive noted in a report.
The Financial Times, meanwhile, said in its report that three IEA members, including the United States, had expressed interest in the joint release, which follows a statement by the IEA’s Fatih Birol from last Friday, saying that there was “plenty of oil” on the market and there were no plans for emergency releases of oil from joint stocks.
“There is plenty of oil, we have no oil shortage,” Birol said after a meeting with European Commission president Ursula von der Leyen and Commission members. “There is a huge surplus in the market.”
Apparently, the surplus has vanished, with the U.S. lifting some sanctions on Russian crude that will now go to India, but will be nowhere near enough to do much about the global supply squeeze, hence the stockpile release discussion. Even if the G7 and IEA agree to release 400 million barrels of oil, chances are this will not have too marked an effect on prices in the absence of signs that supply will normalize.
By Irina Slav for Oilprice.com
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