According to the head of the International Energy Agency (IEA), oil prices are likely to remain high for the foreseeable future. “Personally, I don’t see a credible prospect that 2027 will be a year of ‘normalization’ for the oil market,” Fatih Birol said on Tuesday in London at an event hosted by the “Financial Times.” Consequently, it cannot be ruled out that the IEA might authorize a further release of strategic reserves.
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In March, the 32 member states of the IEA agreed to release 400 million barrels of oil reserves, consisting of both crude oil and refined products such as diesel and kerosene. While this is “a significant amount,” Birol noted, it still represents only 20 percent of the total stockpiles. “The remaining 80 percent are still held in reserve.”
By mid-October, according to the IEA, approximately 330 million barrels had been released onto the market. The strained situation in the diesel market also prompted IEA member states to accelerate the release of the remaining barrels, with a specific focus on diesel.
The military escalation in the Middle East and the Persian Gulf—most notably the closure of the Strait of Hormuz—has significantly reduced the volume of oil reaching the global market on a daily basis. Furthermore, energy infrastructure, including production facilities and refineries in the Gulf states, has been damaged or destroyed, causing lasting disruption to the oil market. Additionally, the destruction of refineries in Russia by Ukrainian forces is driving oil prices higher.
Author: AFP – pe/lan – Translated by Blackout News
Sources: AFP Press Portal