The International Energy Agency (IEA) is consulting governments across Asia and Europe on the possibility of releasing additional emergency oil stocks, as the ongoing conflict involving Iran strains global energy supplies, news agency Reuters reported.
IEA Executive Director Fatih Birol said that the agency stands ready to act if market conditions worsen, following a record coordinated release earlier this month.
“If it is necessary, of course, we will do it. We will analyse the markets and discuss with our member countries,” Birol said while addressing the National Press Club in Canberra at the start of a global tour.
On March 11, IEA member nations agreed to release 400 million barrels of oil from strategic reserves — equivalent to about 20 per cent of total stockpiles — in an effort to stabilise surging crude prices. However, Birol clarified that there is no specific price threshold that would automatically trigger another release.
“A stock release will help to comfort the markets, but this is not the solution. It will only help to reduce the pain in the economy,” he said.
Birol described the current crisis as “very severe”, warning that its impact could exceed that of both the 1970s oil shocks and the energy disruptions following the Russia-Ukraine war combined.
According to the IEA, the conflict has already removed around 11 million barrels per day from global oil supply, intensifying concerns over availability and price volatility.
The agency flagged the strategic importance of the Strait of Hormuz, through which a significant share of global oil, fertilisers, and other essential commodities transit. Birol said reopening and securing the waterway remains the most critical step towards stabilising markets.
“The single most important solution to this problem is opening the Hormuz Strait,” he said.
The Asia-Pacific region is particularly exposed to the disruption due to its heavy dependence on energy imports routed through the strait. Birol began his tour in Canberra, where he met Prime Minister Anthony Albanese, and is scheduled to visit Japan ahead of a Group of Seven meeting.
Beyond stockpile releases, the IEA is also encouraging demand-side measures to ease pressure on fuel consumption. These include steps such as lowering speed limits and promoting work-from-home arrangements, which were deployed in Europe during 2022 to curb energy use.
Birol noted that while Australia holds lower liquid fuel reserves than IEA requirements, recent government efforts have improved stock levels, with around 30 days of diesel supply currently available.
He emphasised that while emergency reserves can provide short-term relief, coordinated global action and restoration of stable supply routes will be essential to address the deeper energy crisis.
