Paris, Jun 24 (Prensa Latina) The International Energy Agency (IEA) will release 60 million barrels of oil from its strategic reserve in July to compensate for the interruption of Libyan exports, said CEO Nobuo Tanaka.
Mr. Tanaka said the 28-member IEA agreed to contribute two million barrels daily over a 30-day period, enabling the council to measure the impact and adopt measures.
This is the third time since its birth in 1974 that the IEA has taken this action; the others were in 1990 during the invasion of Kuwait, and in 2005 when Hurricane Katrina hit oil producing areas in the US south. This time they took into account the expected absence of Lybian crude from the market through 2011 and growing demand through the summer; hence Mr. Tanaka’s warning of “a stiffer oil market threatening to undermine the fragile global economic recovery.”
In his view the IEA decision will help keep oil flowing to the market and guarantee the world economy a soft landing.
The agency said total existing oil in the member countries is over 4.1 million barrels, including 1.6 million from the public reserves available for emergencies.
In response to the request of the IEA, the US said it will release this Thursday 30 million barrels of crude from its strategic reserves, equivalent to national consumption for 36 hours.
Some experts think such behavior is part of the speculation in the world petroleum market, which began to react with prices below $100 per barrel.