24 Jun 2011

Petrol retailers wait as oil prices drop

4:05 pm on 24 June 2011

Fuel retailers in New Zealand are holding steady on any potential prices changes in the wake of tumbling oil prices, saying they're waiting for refined product prices to move first.

Members of the International Energy Agency (IEA) have committed to sell an extra 60 million barrels of their reserves on the world market.

It's only the third time the IEA has asked its member nations - who are mostly oil importers - to release some of their spare supply.

The IEA says the extra oil is needed to fill the gap caused by the disruption of supplies from Libya.

The agency says two million barrels from member states will be released each day over an initial period of 30 days.

Thirty million barrels, half of the total, will be released from the US Strategic Petroleum Reserve, while the UK plans to contribute three million barrels.

The release of reserves temporarily increases global oil supply by about 2.2%.

Brent crude fell by more than 6% on the ICE Futures exchange in London after the agency announced the plan.

Earlier this month, OPEC unexpectedly held oil production steady as some members blocked Gulf efforts to hike output.

The IEA had called on OPEC to increase output to meet demand and lower prices.