IEA Proposes Record Release of Oil Reserves

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0:32Matt Dalton:A key day for oil markets as countries consider a massive release from their strategic reserves, plus how some of the biggest hedge funds got caught off guard by the war.

0:43Luke Vargas:These are considered sort of the first-in-class hedge funds in the industry, and they each lost a billion or more for the week.

0:52Matt Dalton:And the AI boom continues powering up shares of Oracle. It's Wednesday, March 11th. I'm Luke Vargas for The Wall Street Journal, and here is the AM edition of What's News, the top headlines and business stories moving your world today. It's the scoop that has the business world talking. The Journal's Matthew Dalton reports that the International Energy Agency has proposed its largest ever release of oil reserves in an effort to tame a recent run-up in crude prices with a decision expected today. to discuss this potentially historic market intervention. We've got Matt on the line with us from Paris today.

1:30Matt Dalton:Matt, give us the details of this proposal and how it came about.

1:34Alex Leary:So the headline figure is a release of 400 million barrels of oil onto the market by the 32 member countries of the International Energy Agency. It would be the largest release by quite a bit that the agency has ever coordinated, more than double what it put onto the market in 2022. when Russia launched its full-scale invasion of Ukraine. This is meant to address a scenario that is kind of what the IAEA was created for, which is a catastrophic event on the oil market. And that's what is happening right now with the near-complete closure of the Strait of Hormuz due to Iranian attacks. This came together very quickly because IAEA member countries were pretty surprised by the whole war itself.

2:20Alex Leary:They weren't involved in the planning. This is a U.S.-Israeli operation. And they had to scramble to put together a plan, which they have. And it's not a done deal yet. We'll see what happens today.

2:29Matt Dalton:You keep mentioning IEA member countries. There are several dozen of them, but presumably these reserves are not evenly distributed. Whose oil are we mostly talking about here that would hit the market?

2:40Alex Leary:The biggest share will come from the United States and its strategic petroleum reserve. As the largest oil consumer of the 32 member countries, it thus has the biggest responsibility to put oil onto the market. The U.S. quantity will be less than half of what ultimately hits the market, but it'll be close to half. And Japan is also a big consumer and thus will need to put a significant quantity of oil onto the market. The big European economies, Germany, UK, France will also be big suppliers onto the market.

3:12Matt Dalton:Rebecca, just before we hit record, Matt confirmed that the release we're talking about here could be 400 million barrels. You said, oh, wow. Tell us about a release of this magnitude. What would it mean for oil markets?

3:23Rebecca Feng:It's significant because previously colleagues and I did calculations on just how much reserve IEA members have. They have about 1.2 billion barrels in public stocks and another 600 million in commercial inventory. So that would in total, 1.8 billion barrels would roughly last about 124 days with the lost supply from the Gulf. So now if they're looking at a potential 400 million barrels of release, that would back of envelope calculation that would probably satisfy about 30 days of lost supply from the Gulf. It shows the magnitude of the problem. And kind of looking back on price action this morning, we're seeing Brent and WTI both climbing.

4:05Rebecca Feng:It kind of reminds me of an earlier incident when March 2022, when IEA released barrels during the beginning of the Russian-Ukraine war. Price actually rose as well in the first week after the decision. And that's kind of a sign of like traders looking at the numbers and thinking, oh, my, like maybe the situation is actually much worse than we thought. And that's why price initially jumped. And we're kind of seeing the same so far this morning.

4:31Matt Dalton:Okay, I hear what you're saying. An intervention this severe, maybe signals to the market things are worse than many people realize. So that could explain the price reaction we're seeing. But there are other jitters we're seeing, supply-related concerns coming out of the Gulf this morning as well.

4:45Rebecca Feng:Yeah, so when it comes to the oil prices at the current moment, I think the most important news is still whether the straighter hormones is open or not. And the straighter hormones is still paralyzed. Just last night, we had news that U.S. officials said that Iran has placed mines in the Strait of Hormuz over the recent days. That's quite an escalation meant to shut down this waterway. We also have reporting that U.S. forces said that they've destroyed 16 Iranian mine-laying vessels. And then just this morning in London, UK Maritime Trade Operations said that two other cargo ships have reported damage near the Strait of Hormuz.

5:21Rebecca Feng:So that would definitely dissuade other tankers from crossing.

5:25Matt Dalton:Matt, that brings us to today. I'm curious when we're expecting a decision on this possible release. And given that you mentioned such a large share of this would come from the U.S. anyway, I mean, if for whatever reason this doesn't move forward, could the U.S. just act unilaterally?

5:39Alex Leary:So the governing board of the IA is expected to meet today to decide on this. Generally, these matters require unanimous consent for there to be a coordinated release. Yeah, the U.S., any country for that matter, can go ahead and release stocks on its own. The IEA as a body sets guidelines for its members, but these aren't binding necessarily on what countries can do or not do in terms of the oil market. For it to be a coordinated release, all the members really have to act in concert together. You know, a big question going forward is what the timing of these releases will be, how frequent they will be over how many days.

6:13Alex Leary:That will have a big impact on the actual situation in the oil market. This kind of is the first step in the whole process is they're signaling the overall magnitude. But then we're going to be working on getting more details about what the actual flow of oil onto the market will be.

6:28Matt Dalton:I've been speaking to Wall Street Journal reporters Matthew Dalton and Rebecca Fung. Matt, Rebecca, thank you both so much. Thanks, Luke. Glad to be here. And we want to know how volatile energy and commodity prices are affecting you or your business. Are you rethinking your plans today, next week or later this year? Is your bottom line being impacted? What about your pricing strategy? Let us know by sending a voice note to WNPOD at WSJ.com or by leaving us a voicemail at 212-416-4328. And however you choose to get in touch, just make sure to include your full name and your location so we can use your comments on the show.

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7:43Matt Dalton:Markets have been increasingly volatile since the conflict in the Middle East began 12 days ago, And as we report, some of the world's savviest investors have been caught out. Markets reporter Caitlin McCabe says that major hedge funds like Citadel, .72 and Millennium suffered billions in losses following a sudden spike in bond yields.

8:02Luke Vargas:These are considered sort of the first-in-class hedge funds in the industry, and they each lost a billion or more for the week. I think they've been surprised by two things, the strength and severity of the response from Iran and also how much it's choked off oil markets. And so that has really turned on its head these macroeconomic assumptions that hedge funds had. Going into this year, investors were expecting inflation to continue to moderate, for central banks to cut interest rates. And now with$100 oil, you start asking, is inflation going to rise again? And as a result, that's disrupted some bond market bets that hedge funds had.

8:43Luke Vargas:So before last week, hedge funds were having a really strong start to the year. Through the end of February for the year, they were up more than 3%. And now, of course, we have these losses last week to consider.

8:55Matt Dalton:In other Iran news this morning, authorities in the UAE say that four people have been wounded after a pair of Iranian drones fell near Dubai International Airport. Despite the incident, flights are continuing to and from the airport, which is the world's busiest for international travel. Well, speaking of travel, the conflict and high oil prices may be driving up airfares, but travel demand remains resilient. United Airlines says it recently recorded its highest revenue booking day ever, signaling a robust appetite for both domestic and international flights. CEO Scott Kirby attributed this to a strong U.S.

9:31Matt Dalton:economy. Meanwhile, Boeing shares have slipped after the planemaker flagged delays to some deliveries of its 737 MAX jets. The company found scratched wiring in undelivered planes, tracing the issue to a machining error. The FAA is investigating the issue. The delay complicates Boeing's efforts to convince regulators it's improved its safety issues after a door plug incident in 2024. And Oracle shares have rallied more than 7 % in off-hours trading. That's after the cloud computing company posted higher quarterly revenue and raised its sales outlook, saying that companies have a growing need for cloud services to train and run AI.

10:14Matt Dalton:Democrat Sean Harris and Republican Clay Fuller are advancing to a runoff in Georgia following a special election yesterday to fill Marjorie Taylor Greene's vacated House seat. Greene was one of Trump's most vocal supporters in the MAGA movement, but resigned in January after falling out with the president. Trump endorsed Fuller in a crowded field that included nine Republicans, and the district attorney said that the traditionally conservative district still backs the president's policies.

10:41Luke Vargas:They want to know who President Trump was endorsing in this race, and that's why they came out in droves to support him, because they know they want an America First fighter on Capitol Hill fighting for his policies.

10:52Matt Dalton:Meanwhile, Harris, a cattle farmer and retired general, said he wasn't concerned about Trump intervening in the race.

10:58Alex Leary:And guess what? His candidate came in second place. And I'm a firm believer that when we get on head-to-head come April 7th, you're going to be talking to me again because we're going to win it.

11:09Matt Dalton:The winner will serve out the remaining months of Green's term.

11:17Matt Dalton:And finally, what does a president gift to his staff and White House visitors? Some choose pens and cufflinks, FDR chose keychains, And President Trump likes to give out coins, Sharpies, and photos of himself. But our White House reporter Alex Leary says that lately he's been giving away his favorite pair of shoes.

11:37Alex Leary:Trump started wearing Florsheim shoes sometime late in 2025. He was telling aides that his feet were hurting after a long day and tried out a couple of different brands and settled on Florsheim, which is a venerable American brand. It was formed in 1892 in Chicago. Chicago is sort of seen as a sort of a lower end or a mid-level shoe. They cost about$145. According to the White House, he pays out of his own pocket. He's been known to ask in cabinet meetings, did you get the shoes? And he's also been sort of guessing shoe sizes, looking down at people's feet and you may be a 10. And he has a stack of shoes in an office outside the Oval Office, but he also he'll have an aide go and just order some from Florsheim.

12:20Matt Dalton:Referring to the shoes, A female White House official said that all the boys have them and noting that they've created a sense of obligation on the part of those lucky enough to receive them.

12:29Alex Leary:One real funny thing about it is that aides in the White House, they have these and they're afraid not to wear them around Trump because, you know, he gave them to him and he's looking. So it's sort of a funny thing, even if they don't quite like the shoe or if it doesn't fit that well. We reported that one cabinet official joked that he put his Louis Vuittons up on the shelf, that he had to wear the floor charms instead. But it's just a funny kind of slice of life from the White House and Trump who never ceases to surprise.

12:55Matt Dalton:And that's it for What's News for this Wednesday morning. Today's show was produced by Hattie Moyer and Daniel Bach. Our supervising producer is Sandra Killhoff. And I'm Luke Vargas for The Wall Street Journal. We will be back tonight with a new show. Until then, thanks for listening.

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