Many of the world’s oil consuming nations, led by the United States, shocked oil markets this week as the International Energy Agency agreed to release 60m barrels of oil from strategic reserves over the coming month. The move was intended to offset price pressures brought about by Libya’s supply cut and comes in response to Opec’s recent inability to formally endorse new supply increases. The IEA action is also an example of growing concern over higher oil prices in Washington, where the White House is managing political fallout from high gasoline prices as next year’s presidential elections loom just over the horizon.
Yet, a year from now, we’re likely to look back on this moment and find that fears for supply have diminished. Continue reading »