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The International Energy Agency announced Wednesday that it will release 400 million barrels of oil from emergency reserves to help stabilize global energy markets disrupted by the ongoing Iran War.

The move marks the largest coordinated oil stock release in the agency's history. Officials said the decision aims to ease supply shortages and calm rising prices after shipping through the critical Strait of Hormuz was effectively halted.

About 20% of the world's oil usually moves through the narrow waterway, which connects the Persian Gulf to global markets. But tanker traffic has slowed sharply as shippers fear attacks linked to the conflict.

"This is what we are doing today for oil markets," said Fatih Birol, executive director of the IEA, during a press conference.

He described the release as a "major action" meant to help offset supply lost because of the disruption, CBS News reported.

The IEA said its 32 member countries unanimously agreed to the emergency step.

Together, they hold more than 1.2 billion barrels of public emergency oil stocks, along with hundreds of millions of additional barrels stored by industry under government requirements.

The oil will not arrive in markets immediately. Instead, the reserves will be released gradually, depending on the needs and conditions of each member nation.

"The emergency stocks will be made available to the market over a timeframe that is appropriate to the national circumstances of each Member country," the agency said in a statement.

Analysts: IEA Release May Lower Oil Prices

According to CNBC, the supply disruption has already pushed oil prices higher. Earlier this week, the global benchmark Brent crude briefly climbed close to $120 per barrel before pulling back.

Prices were still elevated before the announcement, with Brent trading near $90 per barrel and US benchmark West Texas Intermediate above $84.

Energy analysts say releasing large amounts of oil can help calm markets, at least in the short term.

Hamad Hussein, an economist with Capital Economics, said the move could push prices down as additional supply reaches buyers.

"On the face of it, a large release of strategic reserves from the IEA would help to bring prices down," Hussein wrote in a note to clients.

Still, analysts caution that the effect may not last if the conflict continues or if shipping routes remain closed.

Over the long term, Birol stressed that reopening the Strait of Hormuz is crucial.

Without it, oil producers in the Middle East have limited ways to move their supply to global markets and are beginning to slow production due to storage limits.

The IEA was founded in 1974 after the 1973 Arab–Israeli War and the global oil crisis that followed.

Since then, it has coordinated emergency oil releases several times, including in 2022 after Russia's invasion of Ukraine.

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Oil