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13th Apr 2024

EU points to oil reserves after Iran threat

  • Petrol pumps - even in Greece - will not dry up over night if Iran makes good on its threat (Photo: Antonio)

The European Commission has noted that "there is a lot of oil around" inside reserves in EU countries even if Iran makes good on threats to stop deliveries next week.

Iranian MPs are due to discuss on Sunday (29 January) whether to immediately stop shipping an estimated 600,000 barrels of crude oil a day to member states in reaction to recent EU sanctions.

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The Union on Monday said it would stop buying Iranian oil in July unless it falls in with UN demands on its nuclear programme.

Greece - which last year bought some 35 percent of its oil from Iran - is in the most delicate situation because the financial crisis has made other suppliers wary of giving it credit.

The Greek foreign ministry is keeping quiet on the Iranian threat.

But Athens in recent weeks exacted promises from fellow EU countries they would stick by its side in the event of a disruption before it gave its nod to the anti-Iran sanctions.

Greece itself has around 31 million barrels in its rainy-day stock according to the latest figures of the Paris-based International Energy Agency (IEA) - enough to meet over 90 days of consumption without importing or producing a single drop.

Germany has 283 million barrels, enough for over 100 days of consumption. France, which pushed Greece to adopt the anti-Iran sanctions in the first place, is sitting on 160 million barrels, also enough for 90 days.

European Commission spokeswoman Marlene Holzner told EUobserver on Friday: "If you take all the reserves of all the member states together, it means there is a lot of oil around and if they decide to put it into the market, they can do it."

She added: "Yes, it [an immediate Iranian stoppage] would have an impact, but it's not the case that from one day to another one of our members would have no oil at all."

For her part, EU foreign relations spokeswoman Maja Kocjancic said consultations between member states to make sure disruption scenarios do not leave anybody high and dry "have been going on for quite some time."

Oil markets on Friday stayed calm, with prices going up less than $1 per barrel.

The market reaction was similar to Monday's, when prices went up by just over $1 after Iran repeated threats to block the Strait of Hormuz, a maritime conduit for Saudi oil exports.

Western analysts do not believe Iran would risk a military confrontation with the US, which keeps two aircraft carriers nearby.

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