Oil Dives as World Releases Stockpiles
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Oil plunged 5 percent early Thursday on speculation and then confirmation the International Energy Agency (IEA) would release some of its oil stock.
At a 9AM press conference, IEA Executive Director Nobuo Tanaka announced the 28 IEA member countries have agreed to release 60 million barrels of oil in the coming month in response to the ongoing disruption of oil supplies from Libya.
"Greater tightness in the oil market threatens to undermine the fragile global economic recovery," the group said.
Members countries will make 2 million barrels per day available from their emergency stockpiles over an initial 30 day period.
For its part, the U.S. will release 30 million barrels from the Strategic Petroleum Reserve (SPR) over the next 30 days, or half the full amount of oil coming to the market.
The move by the IEA and the U.S. follows the recent decision by OPEC not to increase production.
Crude was sharply lower on anticipation of such a move and has basically traded range-bound since the announcement. Light, Sweet crude last traded down $4.56 to $90.85 per barrel. WTI is down $4.685 to $95.41 per barrel.
At a 9AM press conference, IEA Executive Director Nobuo Tanaka announced the 28 IEA member countries have agreed to release 60 million barrels of oil in the coming month in response to the ongoing disruption of oil supplies from Libya.
"Greater tightness in the oil market threatens to undermine the fragile global economic recovery," the group said.
Members countries will make 2 million barrels per day available from their emergency stockpiles over an initial 30 day period.
For its part, the U.S. will release 30 million barrels from the Strategic Petroleum Reserve (SPR) over the next 30 days, or half the full amount of oil coming to the market.
The move by the IEA and the U.S. follows the recent decision by OPEC not to increase production.
Crude was sharply lower on anticipation of such a move and has basically traded range-bound since the announcement. Light, Sweet crude last traded down $4.56 to $90.85 per barrel. WTI is down $4.685 to $95.41 per barrel.
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