The International Energy Agency’s member governments held an informal meeting Wednesday to discuss the stock release the G7 agreed on Friday, and expressed support for accelerating the collective action launched in March with a view to completing it as soon as possible, Executive Director Fatih Birol said in a statement. Members also supported prioritizing the release of diesel stocks “to the extent possible, given the current tightness in diesel markets.” Birol said around 325 million barrels have been released under the March action, over 80 percent of the 400 million originally pledged, and that members still hold roughly 1.1 billion barrels of emergency stocks including more than 200 million barrels of diesel. “The IEA stands ready to release more of these stocks to the market if and when required,” he said, adding that members will assess the situation again at the governing board meeting next week.
The market’s reaction tells the story of expectations versus delivery. Brent fell 38 cents to settle at $100.20 and WTI dropped $1.16 to $88.28 on Wednesday after the diesel prioritization was agreed, but both reversed violently overnight on the Hormuz attack news to $105.23 and $92.78. Analysts and some governments noted that completing the previously announced releases could bring around 100 million barrels to market without necessarily representing a fresh intervention of that size, which is why the Financial Times reported diesel prices jumped after the IEA indicated no additional fuel would be released. The March pledge itself was the largest in IEA history at 400 million barrels, and the agency’s own data show emergency stocks remain substantial but finite.
One supply line did firm up Wednesday: Saudi Energy Minister Prince Abdulaziz bin Salman said volumes through the East-West Pipeline had reached 5.8 million barrels a day as of Tuesday morning, the pipeline having been shut in early September after drone damage. That throughput underpins the Gulf export recovery and helps explain why crude has traded the war as a logistics problem while diesel carries the real premium.