The International Energy Agency (IEA) has authorised the historic release of 400 million barrels of oil to address the shortage caused by supply disruptions amid intensifying tensions in the Middle East.

The decision comes after Iran announced the closure of the Strait of Hormuz, a critical passage through which much of the world’s oil supply passes, following U.S.–Israeli joint military strikes on Iran.

The announcement, made on Wednesday, did not set out a timeline for the release of oil stocks. However, it added that the oil would be released in appropriate time depending on the circumstances of the 32 member states.

For context, IEA was formed in 1974 to maintain global energy security in response to the 1973 Arab oil embargo. It primarily consists of advanced economies from Europe, North America and Northeast Asia.

Speaking at the organisation’s headquarters in Paris, the IEA Executive Director Fatih Birol said that considering the significant impacts of the conflict in the Middle East on global oil, gas markets, energy security and global economy for oil, “I can now announce that IEA countries have unanimously decided to launch the largest-ever release of emergency oil stocks in our agency’s history.”

The agency holds over 1.2 billion barrels of oil in public emergency reserves, along with around 600 million barrels of industry stocks held under government obligations

Birol said the release would help mitigate immediate effects of the closure of the Strait of Hormuz. 

The normal flow of traffic from the Strait is needed to bring oil and gas flows back to the global market.