Bankinter | The International Energy Agency (IEA) is releasing 400 million barrels from its strategic reserves. 32 countries are contributing to this release, although the United States is leading the move with 172 million barrels. It is the largest release since 1970. For reference, following the Russian invasion of Ukraine, 172 million barrels per day were released.
Bankinter analysis team’s view: We view the move positively, although the impact is moderate because: (i) the reality is that 400 million barrels represents four days’ consumption. It is true that it aims to compensate for the portion that comes from the Middle East, approximately 20%, so in practice it would mean making up for 20 days’ worth of oil. (ii) It may provide short-term relief, but in the long term, countries will have to replenish their reserves, so there will be renewed buying pressure. (iii) The impact on the market was very moderate, and prices rose again yesterday by approximately 5%, in a context of high geopolitical tension and following Iran’s statements that the price could reach $200. We reiterate our recommendation to tactically buy companies in the oil sector. Oil infrastructure: Halliburton, SLB, Baker Hughes and Técnicas Reunidas. Oil companies: Chevron, Repsol and Eni.
