The Washington administration intends to release some of the oil from its strategic petroleum reserve to lower energy prices, announced US President Donald Trump.
“We're going to do this. And then we're going to fill it up again. I filled it up once and I'm going to fill it up again. But now we're going to reduce it a little bit and that's going to lower prices“, the American leader said in an interview with the WKRC television channel.
The US Strategic Petroleum Reserve was created by an act of the US Congress in 1975 after the global energy crisis to serve as a backup reserve for future emergencies. Currently, four salt storage facilities in Louisiana and Texas store approximately 415 million barrels of oil. The total authorized storage capacity is currently set at 714 million barrels. The US Strategic Petroleum Reserve is the largest government reserve in the world.
Member states of the International Energy Agency (IEA) have agreed to release 400 million barrels of oil from their emergency reserves to stabilize the market due to the conflict in the Middle East. As announced earlier on Wednesday by the head of the agency, Fatih Birol, the IEA countries have agreed to carry out the “largest release of oil reserves in the history of the organization“ against the backdrop of the closure of the Strait of Hormuz.
On March 2, Major General Ebrahim Jabari of Iran's Islamic Revolutionary Guard Corps warned that the Strait of Hormuz, through which approximately one-fifth of the world's oil exports pass, would be closed to shipping due to military actions by Israel and the United States. On March 5, Iranian Foreign Minister Abbas Araghchi said that the strait was not closed and that ships, including tankers, were not trying to cross it for fear of attacks from either side. The operation led to a significant increase in oil prices. However, the price of this commodity subsequently fell.