In an aerial view, Marathon Petroleum Corp’s Los Angeles refinery, one of the largest oil refineries in North America, operates as gas prices soar due to disruptions to global oil supplies caused by the U.S. and Israeli attack on Iran, March 10, 2026 in Carson, California.
David McNew | fake images
Plans to release the largest emergency oil reserve in history are sending a clear signal: energy markets are bracing for a conflict in the Middle East that may last much longer than initially expected.
The International Energy Agency said Wednesday that its 32 member countries would release 400 million barrels of crude from strategic reserves, the largest coordinated reduction since the agency was created in 1974 after an oil crisis the previous year. The United States separately said it would tap 172 million barrels of its Strategic Petroleum Reserve as part of the coordinated effort.
However, crude oil prices continued to rise even after the announcement, underscoring traders’ skepticism that the measures could quickly offset the huge supply shock caused by the war and disruptions to shipping through the Strait of Hormuz.
Oil prices up more than 8% from global benchmark Brent crude oil reaches 100 dollars per barrel, while the West Texas Intermediate jumped 8.8% to $95 per barrel.
Oil prices so far this year
“The extent to which the IEA acted is interpreted by some in the oil market as meaning that the conflict could continue for many weeks,” said Andy Lipow, president of Lipow Oil Associates.
Lipow also noted that the conflict has effectively stopped a significant portion of global energy flows.
About 20 million barrels of crude oil and petroleum products transit the Strait of Hormuz each day, equivalent to approximately 20% of global oil consumption.
Even with the massive emergency release, analysts said strategic reserves can cover only a fraction of the supply loss if the conflict drags on.
“Traders are now doing the math and realizing that IEA reductions can, at best, offset only a fraction of the approximately 15 million barrels per day of net crude and refined products supply loss due to the current disruption of most tanker transits through the Strait of Hormuz,” said Bob McNally, president of Rapidan Energy Group.
He said oil prices will likely continue to rise until there is a ceasefire or a military downgrade of Iran’s strike capabilities, allowing tanker traffic to resume.
Our expectation that this crisis could last for months rather than weeks likely means that markets are underestimating the disruption to global energy markets.
The magnitude of the publication highlighted the seriousness with which policymakers were treating the risk of an oil shortage, said Saul Kavonic of the MST Marquee.
“The IEA decision also signals how serious the risk of oil shortages is, suggesting that the IEA does not believe the war will (likely) end soon.”
Since those reserves will eventually need to be replenished, the move could also point to higher oil prices even after the conflict subsides, Kavonic added.
Some also believe that markets may continue to underestimate the possible magnitude and duration of the crisis, even after recent price increases.
“Our expectation that this crisis could last for months rather than weeks likely means markets are underestimating the disruption to global energy markets,” said Vivek Dhar, head of mining and energy commodities research at Australia’s Commonwealth Bank.
Should physical shortages arise, Dhar said prices may have to rise sharply to curb demand, particularly in developing economies.
“Brent oil could hit $120 or $150 a barrel to force demand destruction among developing economies once physical deficits are realized,” he said, adding that prices could rise further if advanced economies need to price in demand destruction.
