In a statement released on Tuesday, the White House said China, Japan, India, South Korea and the United Kingdom would join the initiative after weeks of discussions to shape a plan to capture the price increase. .
According to the International Energy Agency, which oversees global oil supplies on behalf of the world’s top economies, there have been three coordinated reserve issuances since the agency was created: before Gulf War in 1991, after hurricanes Katrina and Rita damaged oil facilities in the Gulf of Mexico in 2005, and in response to supply disruptions caused by war in Libya in 2011.
“We recognize that rising oil prices are placing a heavy burden on consumers and adding to inflationary pressures during a time of uneven economic recovery and the face of a range of challenges,” the agency said in a statement. risk”.
India has agreed to stockpile 5 million barrels, on time as agreed with five other countries.
The Indian government said in a statement shortly after the White House announcement: “India has repeatedly expressed concern about oil supply being artificially adjusted below demand by oil-producing countries, leading to higher prices and negative consequences for participants”.
It said some of India’s state governments had taken “difficult steps” to cut local fuel taxes.
“Despite the high financial burden on the government, [they] was done to relieve the people,” it added.
The South Korean government said in a statement that the amount and timing of the release of its oil reserves would be decided through consultations with other countries, but said it was expected to be at “a similar level”. as in previous cases of international cooperation.”
“The Korean government has decided to participate in the US proposal to release oil reserves after considering the need for international cooperation in light of the recent sharp increase in international oil prices, the importance of [South Korea]- The alliance of the United States, and the involvement of major powers,” it said in a statement from the State Department.
In a statement, the UK government said it would allow companies to “voluntarily release” oil reserves of up to 1.5 million barrels, in what it called “a reasonable and measured step in support global markets as we emerge from the pandemic.”
A government spokesman said: “As we have said before, we will work closely with our international partners to do what we can to support the global economy through this process. post-pandemic transition”.
The world’s second-largest economy and biggest oil importer told CNN on Friday it was working on a strategic oil release. A spokesman for China’s National Strategy and Food Reserve said China was “promoting the work related to the release of crude oil at the moment.”
The spokesperson declined to comment on whether the move would respond to a request by the United States to work together to address the supply shortage.
Japanese Prime Minister Fumio Kishida on Wednesday confirmed that Japan will release oil from state reserves.
“We have been working with the United States to stabilize the international oil market,” he told reporters, adding that the country would make the move in a way that would not violate oil reserve laws.
Kishida said stabilizing crude oil prices is crucial to helping the economy recover from the coronavirus pandemic. He said more details about the time and amount of oil will be announced at a later time.
Japan has 388 million barrels of total strategic crude oil reserves as of June 2020, according to the US Energy Information Administration. It said about 76% of those are government stocks and about 24% are commercial.
The prospect of the United States and other major energy consumers releasing emergency barrels of oil has helped lower oil prices, at least in the short term. After hitting a peak of $85 per barrel in late October, US oil prices have fallen about 10%. That helped cover the rise in gasoline prices.
—CNN Beijing Office, Manveena Suri, Emiko Jozuka, Junko Ogura, and Yoonjung Seo contributed to this report.