IEA reportedly plans to deploy up to 400 million barrels of oil reserves, double the initial release during the Russia-Ukraine conflict.

According to reports from China News Service and other media outlets, sources say the International Energy Agency (IEA) has proposed releasing up to 400 million barrels of oil reserves, double the 182 million barrels released in 2022.

The IEA is responsible for coordinating oil reserve releases among OECD countries. Shortly before this report, there was news that the IEA would announce recommendations regarding reserve releases at 1 p.m. Greenwich Mean Time (9 p.m. Beijing time).

Sources indicate that the IEA recommends releasing approximately 300 to 400 million barrels of oil reserves. If the final recommendation falls within this range, it would be the largest release in history, surpassing the 182 million barrels released during the Russia-Ukraine conflict.

It is worth noting that earlier reports mentioned some U.S. officials suggesting a joint release of 300 to 400 million barrels, accounting for about 25% to 30% of the oil reserves held by IEA member countries.

The IEA has previously assisted with five similar actions: during the Gulf War in 1991, Hurricane Katrina and Hurricane Rita in 2005, the Libyan civil war in 2011, and twice after the Russia-Ukraine conflict in 2022.

According to CCTV News, Japanese Prime Minister Fumio Kishida stated that due to escalating tensions with Iran, the Japanese government plans to release national oil reserves as early as the 16th. Germany’s Economy Minister also confirmed that the country will release 2.4 million tons of national oil reserves.

Analysts suggest that this move aims to lower soaring oil prices and ease supply concerns caused by disruptions in global shipping. Since the U.S. and Israel launched military strikes against Iran a week ago, the Strait of Hormuz has effectively been closed.

The day before, French Minister of Economy and Finance Roland Lescure requested the IEA to study oil inventories to assess potential release scenarios. Lescure said the G7 countries want to be prepared to use their oil reserves if necessary.

The IEA states that its 32 member countries hold over 1.2 billion barrels of emergency public oil reserves, with the largest portion coming from the U.S. Strategic Petroleum Reserve (SPR). Additionally, industry-held commercial stocks amount to about 600 million barrels under government regulation.

However, some traders and analysts doubt whether these consuming countries’ governments can mobilize their reserves quickly enough to fill the significant supply gap.

Citigroup estimates that due to shipping disruptions, daily oil supply losses could reach 11 to 16 million barrels. Even with the U.S. SPR releasing at maximum speed, combined with contributions from IEA member countries, only part of the gap can be filled.

According to the U.S. Department of Energy website, the maximum daily release capacity of the U.S. Strategic Petroleum Reserve is 4.4 million barrels. Even if Trump ordered the release, it would take about 13 days for the oil to actually enter the market after the decision.