Estonia hosting summit for fuel reserves agencies

  • 2023-09-11
  • BNS/TBT Staff

TALLINN - The Estonian Stockpiling Agency is hosting a two-day summit for the world's fuel reserves agencies whose strategic fuel reserves make up a significant portion of advanced industrialized nations' oil supplies, with representatives expected from altogether 30 countries.

In Tallinn, discussions will revolve around the possibilities of balancing the global oil market, the impact of the green transition on the fossil fuel business, and the exchange of experiences regarding the management of fuel reserves and their utilization during crisis situations.

Priit Enok, a member of the management board of the Estonian Stockpiling Agency, said that the meeting in Tallinn is significant in terms of the number of participants, the level of representation, and timing.

"Everyone is here. Sitting around the table as equal partners are countries with very large fuel reserves, such as the United States and Japan, alongside European smaller countries, among which we also belong. In crisis situations, it is essential to ensure the availability of fuel to society, and in such moments, the size of the reserves is not as crucial as our ability to use them promptly in cooperation with our partners. Russia's aggression in Ukraine and the increasing frequency of climate disasters have vividly demonstrated the importance of reserves," Enok said.

Advanced industrialized countries, led by the United States, began building strategic fuel reserves half a century ago as a result of the first major oil crisis. To counterbalance the disproportionate influence of oil-exporting Arab countries, leading industrialized nations established the International Energy Agency (IEA) in 1974, and countries dependent on fuel imports began stockpiling fuels. National and commercial reserves held by IEA member countries today would cover global oil product consumption for 450 days.

Enok said that countries' strategic fuel reserves have a real impact on managing oil crises and, to some extent, stabilizing fuel prices.

"Estonia's membership in the IEA and active participation in cooperation with reserve agencies in the energy sector can be compared, without exaggeration, to our membership in NATO. The difference here is that we are dealing with energy security and are ready to collectively protect ourselves from market shocks," he said.

The state-owned Estonian Stockpiling Agency maintains strategic reserves of motor gasoline, diesel, and aviation fuel in quantities equivalent to 90 days of Estonia's normal consumption. The fuel reserve is intended to ensure national supply security, security, and the population's coping ability, as well as to fulfill obligations based on international agreements.

The agency collects approximately five million euros in reserve fees annually from fuel sellers to cover the costs of fuel reserve management. The average car owner pays nearly seven euros in reserve fees when refueling over the course of a year. These reserve fees cover all expenses related to reserve management.