IEA's Birol says oil stock release has had 'very good' impact, easing prices

International Energy Agency Executive Director Fatih Birol said March 25 that the agency's coordinated oil stockpile release has had a "very good" impact on the market, helping ease oil prices.

Asked to comment on his assessment of the oil release's impact on the market so far, Birol said, "Very good. We [provided] comfort to the market."

"The prices went down by $18[/barrel], but the situation is still fluid, and I am monitoring the situation," Birol told reporters after meeting Japan's Minister of Economy, Trade and Industry Ryosei Akazawa in Tokyo.

"We are assessing the situation. If necessary, we are ready to act again," he said.

When asked about the timeline for the IEA's coordinated release of 400 million barrels of oil, Birol said, "It is coming slowly but surely."

IEA member states agreed on March 11 to release an unprecedented 400 million barrels of oil from storage, responding to a Middle East supply shock the agency has called the largest in world history.

As for whether current oil prices will impact the long-term trajectory of the coal market, Birol said, "I am sure the high energy prices will lead the governments, with industries and households, to look at other options, especially in Asia. I would be surprised if there were at least temporary upward pressure on the use of coal, both for electricity generation and for industry."

During the meeting, Akazawa said the impact of the current situation in the Middle East on Asia is becoming increasingly severe, as soaring fuel prices and shortages of fuel and raw materials in Asia could significantly affect global manufacturing supply chains.

"In preparation for the possibility that the situation is prolonged, I would like to clearly state and ask that you consider an additional coordinated release as needed in a flexible manner," Akazawa told Birol.

In response, Birol told Akazawa, "We are monitoring all the energy assets in the Middle East."

"And if we believe -- if our countries believe -- there is a need, we will not hesitate to release more stocks to the market. What I released on the 11th of March is only 20% of our stocks," Birol said.

"We still have 80% here, both in terms of crude oil and our products. We will not hesitate to bring it to the market in order to comfort the global economy and help our member countries and other nations," he added.