IEA and the Oil Price Crisis

On March 11, the International Energy Agency (IEA) announced the coordinated release of 426 million barrels of strategic reserves, marking the largest joint release in the organization's history. The United States provided 172.2 million barrels, Japan provided 79.8 million barrels, South Korea provided 22.5 million barrels, and the United Kingdom provided 14 million barrels. This action indeed represents an unprecedented release volume.

Currently, global crude oil daily consumption is about 105 million barrels, and current mainstream estimates suggest that the actual lost supply globally is about 12 million barrels per day. Based on this calculation, the 426 million barrels of strategic reserves could theoretically cover about 35 days.

However, what appears on paper does not equal reality. These oils do not instantaneously reach the market; they need to be released in batches, transported through pipelines and shipping systems, and they also face the issue of regional mismatches.

The war has now entered its third week, and there is no clear timeline for the reopening of the Strait of Hormuz, with no ceasefire expectations in sight. This is the crux of the problem. Strategic reserves are originally meant to respond to temporary oil shocks, such as pipeline failures, hurricane production halts, refinery accidents, etc., and after a problem occurs, there is usually a repair time.

But the blockade of Hormuz does not follow this logic. It is not a supply interruption waiting for repairs; as long as the war continues, the reserves are either continuously supplied, which of course is impossible, or it is merely a drop in the bucket.

To put it plainly, strategic reserves may not resolve the current oil price increase caused by the U.S. and Iran; theoretically speaking, if this war continues for another two weeks, either IEA will continue to release reserve oil, or oil prices are likely to exceed 120 dollars.

Bitget VIP, lower rates, harsher benefits

免责声明：本文章仅代表作者个人观点，不代表本平台的立场和观点。本文章仅供信息分享，不构成对任何人的任何投资建议。用户与作者之间的任何争议，与本平台无关。如网页中刊载的文章或图片涉及侵权，请提供相关的权利证明和身份证明发送邮件到support@aicoin.com，本平台相关工作人员将会进行核查。