LONDON (Realist English). Oil prices rose early Wednesday despite reports that the International Energy Agency (IEA) is considering the largest emergency release of strategic reserves in its history.
Global benchmark Brent crude increased about 0.7% to around $88 per barrel in early trading, while US West Texas Intermediate gained roughly 1.3% to trade above $84 per barrel.
The rise comes amid growing concern about the impact of the war between the United States and Iran on global energy supplies. Energy ministers from the Group of Seven countries met in Paris on Tuesday to assess the conflict and its consequences for international oil and gas markets.
The fighting has disrupted energy production in parts of the Middle East and contributed to a blockade in the Strait of Hormuz, a strategic maritime corridor through which a significant share of the world’s oil exports normally passes.
According to a report by The Wall Street Journal, the IEA has proposed releasing more oil from its emergency reserves than during the coordinated response to Russia’s invasion of Ukraine in 2022, when member states released 182 million barrels.
IEA Executive Director Fatih Birol said member countries currently hold more than 1.2 billion barrels of government-controlled emergency oil stocks, while an additional 600 million barrels are held by industry under government obligations.
Birol warned that conditions in oil markets have deteriorated in recent days due to transport disruptions and reduced production levels.
“This is creating significant and growing risks for the market,” he said, adding that member states were discussing all available options, including the possible release of emergency reserves.
Oil markets have also been influenced by conflicting information about shipping conditions in the Strait of Hormuz. Prices fell sharply on Tuesday after US Energy Secretary Chris Wright incorrectly suggested in a social media post that the US Navy had escorted an oil tanker through the strait.
The post was later deleted, and White House Press Secretary Karoline Leavitt clarified that the US Navy had not escorted any vessels through the waterway.
Analysts say the direction of oil prices will largely depend on how long the conflict continues and whether the Strait of Hormuz reopens to regular shipping.
Sasha Foss, an energy market analyst at Marex, said the potential release of strategic reserves could provide only short-term relief.
“The key variable is the duration of the war,” Foss said, adding that the reopening of the Strait of Hormuz would be the decisive factor for the market.
Some analysts warn that a prolonged conflict could push oil prices significantly higher.
Paul Gooden, head of global natural resources at investment firm Ninety One, said that even if tensions ease in the coming weeks, prices are unlikely to return to the $60–$70 range seen earlier in the year.
If supply disruptions persist, he added, oil prices could climb above $120 per barrel before higher costs begin to reduce global demand.