Germany, Austria to release oil from reserves in response to 400M barrel request

Berlin — Germany and Austria said on Wednesday they would release parts of their oil reserves following an International Energy Agency request for members to release a record 400 million barrels to help reduce rising fuel prices due to the Iran war.

Japan said it would release some of its reserves from Monday.

A group of seven energy ministers met on Tuesday at the IEA headquarters in Paris. IEA Executive Director Fatih Birol said the IEA has discussed all available options, including making emergency oil stocks available to the market.

In the wake of an energy shock induced by a full-scale Russian invasion of Ukraine in 2022, the previous collective release of emergency stocks by IEA member countries amounted to 182.7 million barrels.

IEA members currently hold over 1.2 billion barrels of public emergency oil stocks, with another 600 million barrels of industry stocks held under government obligation.

It was not immediately clear how much Germany and Austria were releasing.

German Economy Minister Katharina Reiche said the country would release parts of its oil reserves following the IEA’s request “to release 400 million barrels of oil reserves, which is a good 54 million tons.”

He said it will take a couple of days before the first doses are distributed.

“Germany stands behind the IEA’s core principle of mutual solidarity,” Reiche said.

In response to the US and Israeli attacks, Iran has attacked commercial shipping across the Persian Gulf, stepping up its campaign to squeeze the oil-rich region as global energy concerns rise. Iran has effectively shut down cargo traffic in the Strait of Hormuz, through which one-fifth of all oil is transported from the Persian Gulf to the Indian Ocean.

Iran has targeted oil fields and refineries in Gulf Arab states, aiming to cause enough global economic pain to pressure the United States and Israel to end their strikes. Reports of sea mines allegedly laid by Iran in the Strait of Hormuz have raised concerns about the security of international energy supplies.

G7 energy ministers announced on Tuesday that they support in principle “the implementation of proactive measures to address the situation, including the use of strategic reserves”.

According to the IEA, export volumes of raw and refined products are currently less than 10% of pre-war levels.

Austrian Economy Minister Wolfgang Hattmannsdorfer said his country was releasing part of the emergency oil reserve and expanding the national strategic gas reserve: “One thing is clear: in a crisis, there should be no crisis winners at the expense of travelers and businesses.”

The German government has said it will introduce a measure that would allow gas stations in Germany to raise fuel prices more than once a day. Reiche said the federal government wants to introduce it as soon as possible.

In Austria, starting Monday, price increases at gas stations will only be allowed three times a week, the country’s economy minister said.

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Petrequin reports from Paris.