On June 8, the Organization of Petroleum Exporting Companies will hold a meeting in Vienna. The meeting may be chaired by Mahmoud Ahmadinejad, the president of Iran, a prospect that has some people in the West nervous. Today, the International Energy Agency issued a statement urging oil producers to make more oil available, lest prices balloon out of control.
"Additional increases in prices at this stage of the economic cycle risk derailing the global economic recovery," the IEA statement reads, "and are neither in the interest of producing nor of consuming countries." Since oil demand is typically highest from May to August, "there is a clear, urgent need for additional supplies" in the near future. The Guardian points out that the statement is "clearly designed to put pressure" on OPEC, and Reuters notes that it's unusual to hear from IEA at all; the agency usually doesn't comment on matters like this. "It is quite rare that the IEA goes out directly to give suggestions to OPEC," said Christin Tuxen, an analyst at Danske Markets.
So the IEA's taking a special step here. But it's hard to say whether it will work. Ahmadinejad is a wild card, and at least one OPEC nation, Saudi Arabia, has compelling reasons not to make more oil available--it needs oil revenue to fund its military and domestic welfare programs, according to a report from JCB Energy. Meanwhile, it's not clear who will even represent Libya at the meeting. The country's oil minister, Shukri Ghanem, may or may not have defected, and the rebels fighting Muammar Qaddafi have submitted a request to represent Libya in his absence.