An emergency meeting has been called amid fears over a severe global oil shortage, with petrol prices already surging in the UK. Over 30 members of the International Energy Agency will “assess the current security of supply and market conditions to inform a subsequent decision on whether to make emergency stocks […] available to the market,” IEA Executive Director Fatih Birol said in a statement.
Oil prices dropped by more than 11% as markets began anticipating a release of emergency oil reserves, a sharp reversal after prices had surged to nearly $120 per barrel on the weekend following the supply disruption. Fatih Birol noted that energy ministers from the Group of Seven nations met earlier on Tuesday to discuss possible responses to the crisis.
The G7 — Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States — are all members of the International Energy Agency, giving them a central role in coordinating any collective action.
The International Energy Agency’s 31 member countries — largely made up of advanced Western economies — are growing increasingly anxious in light of Operation Epic Fury, launched by the US and Israel in late February, and Iran’s retaliatory attacks in the Middle East, which are putting vital Gulf energy facilities and supply routes at risk.
The escalating conflict has already disrupted regional stability, and commercial vessels have begun steering clear of the Strait of Hormuz, a narrow passage that handles about 20% of global energy shipments. With shipping diverting away from this crucial chokepoint, concerns are mounting over the possibility of sharp spikes in global oil prices.
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West Texas Intermediate (WTI) crude slipped on Tuesday, trading near $82.30 — a decline of about 1.15% — as traders reassessed supply risks in light of recent remarks from international energy officials.
Japan’s Industry Minister Yoji Muto Akazawa said on Tuesday that he discussed the global energy situation with G7 energy ministers, including the potential release of strategic Oil reserves if necessary.
According to Akazawa, the G7 confirmed its readiness to take “necessary measures” to support global energy supplies.
Meanwhile, the Middle East’s largest oil refinery, located in the United Arab Emirates, was struck by Iranian drones, heightening concerns about a potential surge in global oil prices.
On Tuesday, a swarm of Iranian drones penetrated Emirati air defenses and hit Abu Dhabi National Oil Company’s Ruwais facility — one of the most significant targets Iran has struck since the conflict began.