Oil prices fall as reserves are released

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Friday, September 2, 2005

The International Energy Agency announced that its member states will release 60 million oil barrels from their strategic reserves next month. "All 26 member countries will take collective action", said the agency in its statement. The announcement was in response to the crude price surge after disruption of oil supply in the Gulf of Mexico caused by Hurricane Katrina.

Earlier today Javier Solana, chief of the European Union's foreign policy, said the EU can provide the US with reserves of the member states. Also OPEC is considering taking action. The United States and Japan already plan to release oil from their reserve stocks.

Oil prices fell slightly today, following the IEA statement, as expected. US light crude fell US$1.57 to US$67.90 a barrel.

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