Historic move amid Hormuz closure: IEA approves emergency release of 400 million barrels of oil

The International Energy Agency (IEA) has announced a historic decision to release 400 million barrels of oil from its emergency reserves, responding to disruptions in global oil markets caused by the conflict in West Asia and the effective closure of the Strait of Hormuz.

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The unanimous agreement was made by the IEA's 32 member countries on Wednesday. The decision aims to address the severe supply shortages resulting from Iran's closure of the Strait of Hormuz, a vital passage for global oil trade.

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"The oil market challenges we are facing are unprecedented in scale, therefore, I am very glad that IEA Member countries have responded with an emergency collective action of unprecedented size," IEA Executive Director Fatih Birol said in a statement.

"Oil markets are global, so the response to major disruptions needs to be global too. Energy security is the founding mandate of the IEA, and I am pleased that IEA Members are showing strong solidarity in taking decisive action together."

The IEA holds over 1.2 billion barrels in public emergency stocks, in addition to 600 million barrels in industry stocks under government obligation. This coordinated action marks the sixth release in the agency's history, following previous measures taken in 1991, 2005, 2011, and twice in 2022.

The Iran conflict, which began on February 28, has crippled oil flows through the Strait of Hormuz, with crude and refined product exports from the region currently at less than 10% of pre-conflict levels. 

An average of 20 million barrels per day of crude oil and oil products transited the Strait of Hormuz in 2025, or around 25% of the world's seaborne oil trade. Options for oil flows to bypass the Strait of Hormuz are limited.

Iran's military warned on Wednesday that the world should be prepared for $200 per barrel, as it won't allow "even one litre of oil to pass through the Hormuz.