<p>The International Energy Agency (IEA) plans to propose the release of its largest-ever strategic oil reserves to stabilize the sharply rising international oil prices due to the conflict between the United States, Israel, and Iran.</p>
<p>According to sources cited by The Wall Street Journal, the scale of this release is expected to exceed the 182 million barrels released during the Russia-Ukraine conflict in 2022. IEA member countries are expected to make a decision on this proposal on Wednesday, and it can be approved if there are no objections from member states, but any dissent from a single country could delay the plan. Following the news of the IEA proposal, international oil prices fell in the short term, with WTI crude futures turning down by 0.4%.</p>
<p>Additionally, Reuters reported that Emmanuel Macron, the current president of France, which holds the G7 presidency, will convene a conference call with G7 leaders on Wednesday to focus on the Iran crisis and the sharp rise in energy prices. Previously, G7 energy ministers did not reach an agreement on releasing strategic oil reserves during their meeting on Tuesday, instead requesting the IEA to assess the current situation before taking action.</p>
<p>Bloomberg senior commodities reporter Javier Blas revealed that the video call is scheduled for 2 PM GMT (10 PM Beijing time) and will focus on the &#34;energy situation&#34; and the issue of the Strait of Hormuz, clearly stating, &#34;I doubt this will be just a verbal intervention.&#34;</p>
<p>Oil prices have already experienced two significant fluctuations this week. On Monday, the benchmark oil price surged to a nearly four-year high; on Tuesday, U.S. President Trump predicted that the Middle East conflict might end soon, causing oil prices to plummet by 11%; on Tuesday evening, a &#34;false&#34; tweet from the U.S. Secretary of Energy claimed that the U.S. Navy had successfully escorted an oil tanker through the Strait of Hormuz, leading to a temporary 20% drop in oil prices. If G7 leaders announce substantial measures after the call, tonight could trigger significant fluctuations in oil prices for the third consecutive trading day.</p>
<h2>IEA's Large Inventory Provides Room for Intervention</h2>
<p>The IEA currently has sufficient reserve resources to address the current supply shortage. IEA Executive Director Fatih Birol stated on Monday that member countries hold 1.2 billion barrels of public reserves, in addition to 600 million barrels of mandatory commercial inventories. Rough estimates suggest that these inventories are roughly equivalent to 124 days of lost supply in the Gulf region.</p>
<p>Although crude oil prices fell below $84 that day, prices for refined products like diesel continue to rise. If the IEA's large-scale release plan is successfully implemented, it will inject liquidity into the market and alleviate the spot tightness caused by physical supply disruptions.</p>
<h2>G7 Energy Ministers Fail to Reach Consensus on Strategic Reserve Release</h2>
<p>Before the leaders' call on Wednesday, G7 energy ministers consulted on the situation on Tuesday but failed to reach an agreement on releasing strategic oil reserves. According to Reuters, the energy ministers instead requested the IEA to assess the current situation before making a decision, effectively postponing the decision-making authority to the next stage.</p>
<p>This outcome has cooled market expectations for an immediate policy response, but it also means that meetings at the leadership level carry more political pressure and decision-making weight than ministerial consultations, making tonight's video call highly anticipated</p>
<h2>Historical Effects of Strategic Reserves Release</h2>
<p>Historically, the actual impact of releasing strategic reserves on the market has been mixed. After the outbreak of the Russia-Ukraine conflict in early 2022, IEA member countries released oil reserves twice in succession. Initially, this led to a 20% increase in oil prices, as traders viewed it as a signal that the oil crisis was more severe than expected. However, analysts pointed out that the release of reserves ultimately helped stabilize oil prices.</p>
<p>One particularly successful intervention occurred during the Gulf War in 1991. At that time, then U.S. President George H.W. Bush ordered the first-ever extraction of the Strategic Petroleum Reserve (SPR) on the night of the multinational forces' attack on Iraq, and IEA member countries simultaneously released reserves as planned. On the first day of the U.S.-led offensive, oil prices plummeted by more than 20%, effectively stabilizing the global energy market during wartime.</p>
<h2>Impact of the Strait of Hormuz Crisis on Global Supply</h2>
<p>The core reason for the IEA's proposal to release strategic reserves is to address the significant supply disruption caused by the near-total closure of the Strait of Hormuz. The Strait of Hormuz is a vital waterway connecting the Persian Gulf to global markets, with approximately one-fifth of the world's oil supply transported through it daily. Due to threats from Iran against oil tankers, energy transportation through this strait has come to a near standstill.</p>
<p>The risk of oil supply disruptions due to geopolitical conflicts in the Middle East was precisely the reason Western countries and their allies established the IEA after the Arab oil embargo in 1974. As a coordinating body, the IEA sets standards for crude oil reserves for its member countries and protects the global economy from the shocks of oil market volatility through coordinated releases of reserves</p>

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<p>According to reports, the International Energy Agency (IEA) plans to propose the release of the largest-ever strategic oil reserves, potentially exceeding 182 million barrels during the Russia-Ukraine conflict in 2022. Meanwhile, G7 leaders will hold an emergency conference call on Wednesday to specifically discuss the Iran crisis and soaring energy prices. Oil prices have already experienced two significant fluctuations this week, and tonight may become the third major volatility trigger, with the global energy market holding its breath</p>

- The International Energy Agency (IEA) is proposing the largest release of strategic oil reserves in its history to stabilize soaring oil prices due to conflicts involving the U.S., Israel, and Iran.  
- If approved, the release could exceed the 182 million barrels released during the 2022 Russia-Ukraine conflict, impacting market liquidity and potentially easing supply shortages.  
- G7 leaders will hold a video call to discuss the Iranian crisis and energy prices, amidst significant recent fluctuations in oil prices and a dangerous situation in the Strait of Hormuz.

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The IEA plans to propose the release of record oil reserves, G7 leaders hold an emergency conference call, and oil prices may face a third wave of severe fluctuations tonight?