Donna Dong
Research Analyst, Flux
Brent Recovers to $102.02/bbl
International Energy Agency signals possible reserve release as Donald Trump urges allies to reopen Hormuz after Iran conflict slashes Gulf
The May’26 Brent futures briefly dipped from $103.20/bbl at 12:30 GMT to $99.85/bbl at 14:10 GMT, before recovering to $102.02/bbl at 17:00 GMT (time of writing).
In the news, member countries of the International Energy Agency (IEA) may release additional oil into the market later "as and if needed," following their agreement to the largest-ever reserve release, according to Executive Director Fatih Birol. He noted that some of the oil from their previous 400mb release has already begun flowing into Asia; he also said that 1.4 billion barrels would remain in the emergency oil stocks of IEA members. Elsewhere, President Trump has repeated his call on allies to assist in unblocking the Strait of Hormuz; he has also criticised countries he claimed were reluctant to provide aid. Trump has urged nations to help police the strait after Iran responded to US-Israeli attacks with drones, missiles, and mines, effectively closing the channel for tankers that usually carry a fifth of global oil and liquefied natural gas. In the Middle Eastern Gulf, daily oil exports have dropped by at least 60% in the week ending 15 Mar compared with Feb, due to the closure of the Strait of Hormuz. Exports of crude, condensate, and refined fuels from eight Middle Eastern countries - Saudi Arabia, Kuwait, Iran, Iraq, Oman, Qatar, Bahrain, and the United Arab Emirates - averaged 9.71mb/d in the week ending 15 Mar, according to Kpler. In other news, the EU’s foreign policy chief, Kaja Kallas, has stated that foreign ministers will discuss the possibility of relocating a currently active mission in the Middle East to help unblock the Strait of Hormuz. Finally, at the time of writing, the front-month (May/Jun) and 6-month (May/Nov) Brent futures spreads are at $4.29/bbl and $19.03/bbl, respectively.
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