IEA welcomes US decision to use SPR
The governing board of the International Energy Agency met Wednesday and affirmed the agency's policy of not using security oil stockpiles other than for a significant oil supply disruption. IEA said that was not the case in the oil market today.
PARIS�The governing board of the International Energy Agency met Wednesday and affirmed the agency's policy of not using security oil stockpiles other than for a "significant oil supply disruption."
IEA said that was not the case in the oil market today: although stocks are low, there is no crude shortfall, only regional product shortfalls.
The IEA governing board, however, "Welcomed the positive effect on the market of the recent decision by the US government to release 30 million bbl of crude from the Strategic Petroleum Reserve." Observers said the statement was unexpected, considering that the IEA does not, as a rule, approve of strategic stock drawdowns unless it has given the signal to do so.
The IEA urged oil companies and refiners to "consider intensified and reconfigured short-term refinery operations" to remedy product shortfalls. IEA Executive Director Robert Priddle said that if product supplies were tight in North America with refineries running at near 100% of capacity, they were running at 90% in Europe, and there was spare capacity in the Far East.
The board said it would "give new impetus" to longer-term policies to reduce oil demand, improve energy efficiency, diversify supplies, and accelerate the deployment of energy technologies.