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Premier eFinance: Asia joins west in releasing oil reserves.
Asian countries move to release emergency oil stockpiles as part of a coordinated plan by consumer nations to ease the impact of climbing energy prices on economic recovery.
By: Premier eFinance
News of the action saw oil prices fall to a four-month low recently.
Some concern has arisen that the unexpected decision by the International Energy Agency to release 60 million barrels over the next month would have a long-term impact, with the Japanese Economics Minister Kaoru Yosano telling Premier eFinance that the IEA move could be seen as a warning to speculative buyers, while India's Oil Minister S. Jaipal Reddy doubted the action would have any significant impact.
"Even if there is a slight increase in production, those gains will not be made available to us because of unbridled speculation in the financial markets of the world," Reddy told Premier eFinance. "We don't know whether this (weaker oil prices) is a stable trend."
The stock release is only the third in the 37-year history of the IEA which was established as a counter weight to exporting group OPEC.
IEA Asian members Japan and Korea have announced that they would begin releasing reserves from next week in line with the agency's targets.
Japan will cut the reserve requirement for oil companies by 7.9 million barrels over the next 30 days and South Korea will release 3.46 million barrels, together providing about 19% of the agency’s target.
Australia and New Zealand, the remaining members from the Asia-Pacific region of the 28-nation grouping have chosen not to participate.
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