The Trump administration plans to release 172 million barrels from the US emergency oil reserve, according to Bloomberg. The move is part of an international effort to ease rising crude and petrol prices linked to the Iran war. The oil will come from the US Energy Department’s Strategic Petroleum Reserve. It forms part of a plan by International Energy Agency member nations to release a combined 400 million barrels from reserves worldwide.

Market Reaction In 2025

Deliveries are expected to start next week and continue for about 120 days. Following the news, crude prices rose, with West Texas Intermediate up 4.38% to $90.80. When we look back at the events of 2025, the big takeaway was how the market reacted to the massive reserve release during the Iran war. The announcement of 400 million barrels was meant to crush prices, but instead, crude immediately spiked over 4% to $90. This told us the market saw the release not as a solution, but as a sign of panic confirming a severe supply shortage. That action has left government stockpiles dangerously low a year later. The U.S. Strategic Petroleum Reserve, for instance, now sits near 40-year lows at just 362 million barrels, leaving us with far less firepower to combat any new supply shocks. This lack of a safety net is a critical factor for the market in March 2026. With WTI crude currently trading around $85 a barrel, the market remains tense due to ongoing shipping disruptions in the Red Sea and the unresolved conflict in Ukraine. These persistent risks, combined with low global inventories, create a fragile situation where any disruption can cause a significant price surge. We believe the market is not adequately pricing in this vulnerability.

Trading Positioning For Volatility

Therefore, we should consider positioning for upward price volatility in the coming weeks. Buying call options on summer contracts with strike prices around $95 or $100 could offer significant returns if geopolitical tensions flare up. Selling out-of-the-money put options is also a viable strategy to collect premium, betting that the tight supply situation will prevent any major price collapse. This view is further supported by the discipline we’re seeing from OPEC+. The group’s recent decision to extend production cuts through the second quarter shows they are determined to keep a floor under prices. Their actions effectively remove surplus oil from the market, tightening the supply-demand balance even more. The primary risk to this outlook would be a sudden diplomatic breakthrough in current conflicts or a sharp global economic slowdown that triggers demand destruction. We must keep a close watch on shipping data and weekly inventory reports for any signs of weakening consumption. Create your live VT Markets account and start trading now.

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