Major economies have released a record 400 million barrels of strategic oil reserves to ease the impact of the Middle East war on energy markets, but investors remain concerned. Despite this historic drawdown, prices surged above $100 a barrel due to fresh Iranian strikes on energy infrastructure and fears of a prolonged conflict.
The International Energy Agency (IEA) member countries’ move is seen as too small to offset the disruption triggered by American-Israeli attacks against Iran on February 28. Daily global crude production is down at least 8.0 million barrels, with an additional 2.0 million related to petroleum products shut off.
Analysts warn that the release of reserves is a temporary solution and the key to resolving the crisis is reopening the Strait of Hormuz, which handles about a fifth of the world’s crude oil. The IEA has warned that the war is creating the largest supply disruption in the history of the global oil market.
