Live news updates from March 6: US and UK impose new sanctions on Russian banks, Fed prepares to slash size of balance sheet

The price of oil headed lower on Wednesday after a group of the world’s biggest consumers said they would tap emergency stockpiles to counter supply concerns following Russia’s invasion of Ukraine.

Brent, the international crude oil marker, was down 2.6 per cent at $103.79 a barrel, while West Texas Intermediate, the US benchmark, was off 3 per cent at $98.93.

Fatih Birol, head of the International Energy Agency, said its 31 members, were moving ahead with a “collective oil stock release” of 120mn barrels.

The US will contribute half of that amount, Birol said in a tweet, while the remaining 60mn barrels will come from the rest of the IEA, which counts Germany, Japan and the UK as members. More details about specific member contributions would be made public soon, he continued.

The @IEA is moving ahead with a collective oil stock release of 120 million barrels (including 60 million barrels contributed by the US as part of its overall draw from its Strategic Petroleum Reserve).

More details of specific contributions will be made public soon.

— Fatih Birol (@fbirol) April 6, 2022

Washington last week announced plans to release 180mn barrels of oil from its strategic petroleum reserves, which is equivalent to about 1mn barrels per day for six months. 

Of that figure, 60mn will be released in conjunction with the IEA, as per Wednesday’s announcement, while 120mn barrels will be released independently by the US.

IEA members agreed on Friday to a new release of oil from emergency reserves but did not provide any details on volumes or contributions.

“This collective action, will exceed the 1 million barrels per day for 6 months that the United States has committed to release, increases the combined amount to 240 million barrels,” said the US Department of Energy in a statement, referring to the 60mn barrels of oil pledged by US allies.

The Paris-based body warned last month that, 3 mb/d of Russian oil output could be “shut in” from April as sanctions take hold and buyers shun exports. Tapping emergency reserves will go some way towards filling that gap.

The latest release follows a 61mn barrel deployment in early March that failed to calm prices, which have been through weeks of stomach-churning volatility.