The International Energy Agency (IEA) says it is prepared to help stabilise the global oil market amid rising prices triggered by the ongoing conflict involving the United States, Israel and Iran, according to a report by Bloomberg.
Oil prices have trended upward since US President Donald Trump hinted at the possibility of military action against Iran following stalled negotiations over the Gulf country’s nuclear programme. The rally intensified after the conflict escalated at the weekend.
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Brent crude has sustained its upward momentum since hostilities broke out, heightening concerns over supply disruptions in the Middle East.
The escalation has led to destruction, fatalities and humanitarian concerns in the region, while also rattling global energy markets.
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Gas and other petroleum product prices have increased amid fears of disruptions to crude oil and condensate shipments.
On Monday, the Dangote Petroleum Refinery in Nigeria quietly adjusted its petrol gantry price. By Tuesday, several filling stations in Abuja had adjusted pump prices upward, reflecting the strain in product supply and higher landing costs.
Market watchers attribute part of the disruption to constraints around the Strait of Hormuz, a critical chokepoint for global oil shipments.
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IEA emergency stockpiles
According to a document prepared by the IEA and seen by Bloomberg News, member countries collectively hold more than one billion barrels in emergency stockpiles.
While oil production in the region remains largely unaffected, the agency noted in a document dated 2 March that flows through the Strait of Hormuz, as well as liquefied natural gas production, have been “significantly impacted.”
The IEA is scheduled to hold a meeting at 2 p.m. Paris time to assess developments in the Middle East, according to people familiar with the matter.
The agency coordinates global releases of oil inventories during periods of market disruption.
READ ALSO: US/Israel-Iran war: Nigerian embassy urges citizens in Kuwait, Bahrain to stay vigilant
Although the document states that the IEA can bring additional supply to the market when necessary, it does not outline any immediate plan to do so, noting that the market is adequately supplied for now.
It was reported that the organisation has coordinated five emergency stock releases over the past 35 years — during the 1991 Gulf War, after Hurricanes Katrina and Rita in 2005, during the 2011 Libyan uprising, and twice following Russia’s 2022 invasion of Ukraine.
Oil futures climbed above $85 per barrel on Tuesday for the first time since July 2024, as the conflict intensified and a fire at a major storage facility in the United Arab Emirates heightened concerns about risks to critical energy infrastructure.
Earlier on Sunday, the OPEC+ alliance agreed to a modest production increase, with key members of the bloc such as Saudi Arabia boosting exports. However, analysts say the move has not been sufficient to calm the market, particularly as shipping constraints through the Strait of Hormuz limit supply flexibility.
The IEA comprises 32 member countries within the Organisation for Economic Cooperation and Development, including the United States, Germany and Japan.
Members are required to maintain emergency oil stockpiles equivalent to at least 90 days of net imports.
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