Brazil joins initiative to release 60 million barrels of oil due to rising prices

RIO DE JANEIRO, BRAZIL – Brazil assured that it is “closely monitoring” the volatility of international oil and gas prices and that it will join the request of the International Energy Agency (IEA) to release 60 million barrels to contain the price increase, which has generated fears of supply shortages.

The Brazilian Foreign Ministry and the Ministry of Mines and Energy issued a joint statement assuring that they follow the “possible reflections in the production and supply chains of oil, natural gas, and its derivatives” in the financial markets that could affect Latin America’s leading economy.

“The current moment also reinforces the importance of diversifying the energy matrix and ensuring access to the most secure and sustainable energy,” the press release says.

Brazil, which produces about three million barrels of oil per day, said it would seek to contribute to “increasing world energy security”.

The South American giant is an important world oil producer, with an average of three million barrels per day, contributing to the increase of global energy security, with growing diversification of players and market strength,” the press release adds.

On Friday, March 4, a Ukrainian nuclear power plant fire caused the markets to operate with volatility. The Brent reference rose to US$114.23 a barrel, an increase of US$3.28, or 3%. Meanwhile, U.S. West Texas Intermediate added US$3.19, or 3%, to US$110.86, after touching a high of US$112.84.

“Russia’s military operation in Ukraine means supply fears will remain in focus,” said Stephen Brennock of oil broker PVM. International oil prices touched decade highs this week, with the U.S. benchmark up more than 20% and Brent up 17%.

Brazilian President Jair Bolsonaro claims that his country is neutral in the conflict. Bolsonaro visited Russia just a week before the Russian incursion into Ukraine.