International Energy Agency plans to release the "largest ever" oil reserves, over 180 million barrels, to counter the Homs blockade and suppress soaring oil prices.

WSJ reports: The International Energy Agency (IEA) has circulated the largest-ever oil reserve release plan during an emergency meeting with its 32 member countries, exceeding the 182 million barrels released during the Russia-Ukraine war in 2022. The international community is attempting a systematic intervention to positively address the energy crisis triggered by the Iran conflict.
(Background: UAE and Kuwait announce oil production cuts, Middle Eastern energy supply chain disrupted, G7 temporarily does not release strategic reserves)
(Additional background: Iranian Revolutionary Guard: The Strait of Hormuz has been blocked! Any ships attempting passage will be burned)

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• Record-breaking scale: surpassing 182 million barrels during the 2022 Russia-Ukraine war
• Hormuz nearly fully closed: 20% of global oil daily traffic stuck here
• Inflation alert: if oil prices stay high, stock market correction is inevitable

Since late February, after the US and Israel launched airstrikes on Iran, oil prices surged over 60%, breaking $110 per barrel, triggering inflation alarms across global markets. Against this backdrop, The Wall Street Journal (WSJ) reports today (11th):

The IEA has proposed the largest-ever oil reserve release to its 32 member countries, with a formal vote scheduled for March 11.

Record-breaking scale: surpassing 182 million barrels during the 2022 Russia-Ukraine war

According to informed officials speaking to WSJ, this proposed release will “exceed the record of 182 million barrels released twice by IEA members in 2022,” when Russia was conducting a full invasion of Ukraine, causing global energy markets to panic.

However, the approval threshold for this reserve release is very high: if any of the 32 member countries objects, the plan could be delayed. If no member opposes, the plan will be officially adopted, and the mechanism will be activated immediately.

The IEA’s confidence in this move comes from its large reserves. Executive Director Birol stated that IEA member countries currently hold about 1.2 billion barrels of public oil reserves, plus approximately 600 million barrels of mandatory commercial stocks, enough to cover about 124 days of supply disruptions in the Gulf region.

Hormuz nearly fully closed: 20% of global oil stuck daily

The immediate trigger for this emergency action is the near-total closure of the Strait of Hormuz. This narrow waterway connecting the Persian Gulf to global markets handles about 20% of the world’s daily oil supply; threats of Iranian attacks on tankers have nearly halted shipping, with hundreds of ships waiting outside the passage.

Since the US-Israel coalition first struck Iran on February 28, the Hormuz blockade has entered its second week. Alternative pipeline options can only theoretically fill 25% to 35% of the gap; the remaining shortfall cannot be made up with existing infrastructure.

Inflation alert: sustained high oil prices could lead to stock market corrections

Economists warn that persistent high oil prices pose a significant risk of transmitting inflation globally: rising diesel prices directly increase logistics costs, which then drive up prices for food, manufacturing, and other goods. If the Federal Reserve is forced to delay rate cuts or even resume hikes to curb inflation, the risk of stock market corrections will greatly increase.

Whether the IEA’s reserve release plan can effectively lower oil prices and ease global inflation depends on the speed of implementation and whether member countries release actual quantities as planned.