Largest-Ever Oil Reserve Release Fails to Fill the Gap

Although member countries of the International Energy Agency agreed to jointly release a total of 400 million barrels of strategic oil reserves to ease the global crude oil supply tightness, this largest-ever coordinated release has still failed to calm market concerns. After the next trading day opened on the evening of the 11th U.S. Eastern Time, the May delivery London Brent crude futures price briefly rose back above $100 per barrel. Subsequently, several countries announced they would release national oil reserves. Germany’s Federal Minister for Economic Affairs and Energy, Robert Habeck, stated on the 11th that Germany would release 19.51 million barrels of strategic oil reserves to ease rising oil prices. On the same day, the Japanese government also announced it might start releasing national oil reserves on the 16th, marking the first time since the establishment of Japan’s national oil reserve system in 1978 that the country has released reserves independently. The South Korean government announced in the early hours of the 12th that it would release 22.46 million barrels of oil reserves. Later that evening, the U.S. Department of Energy issued a statement saying it would release approximately 172 million barrels of strategic oil reserves over the next roughly 120 days to address rising oil prices. This release is the largest in history, but market analysts remain cautious about its impact, with ongoing focus on the progress of the U.S.-Israel-Iran conflict and the situation in the Strait of Hormuz. Some analysts believe that releasing oil reserves may temporarily ease market worries, but to fully dispel market doubts, the conflict must be completely resolved or at least show a clear path toward de-escalation. Others point out that current oil exports from Gulf countries have significantly decreased, and releasing reserves and other alternative sources still cannot fully fill the current supply gap. (CCTV Finance)