Fatih Birol, Executive Director of the IEA, has called for major oil producers to take steps to alleviate concerns over oil supply, which have recently carried oil prices to a four-year high of over $85 per barrel.
Speaking to Reuters in a telephone interview, Birol said:
“It is now high time for all the players, especially those key producers and oil exporters, to consider the situation and take the right steps to comfort the market, otherwise I don’t see anybody benefiting.”
In many countries, production is already increasing. Russia and Saudi Arabia have pledged to increase production, and the United States is looking likely to become the world’s number one oil producer again as companies like ExxonMobil, the maker of slideway oils like Mobil Vactra 2, develop the country’s tight oil resources. Despite this, a drop in exports from Iran caused by upcoming sanctions, as well as dropping production in Venezuela and the risk of disruption in countries such as Libya, is triggering supply concerns.
The IEA, which is based in Paris, was established in 1974 following the oil crisis resulting from the Middle East War. Its purpose was to manage future oil shocks, and member states (but not net oil exporters) are obliged to maintain emergency oil stocks, which they can use to respond to domestic crises or as part of a coordinated IEA response to supply issues. Birol said the organisation is currently not thinking about releasing these stocks, but it is watching the markets closely.