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Estonia is hosting the summit for fuel stockholding entities from around the world

Submitted by ospa on Mon, 09/11/2023 - 16:15

Press release by AS Eesti Varude Keskus (Estonian Stockpiling Agency)
11 September 2023

Starting from Monday, 11 September, the Estonian Stockpiling Agency (ESPA) will host the two-day summit for fuel stockholding entities from around the world. The meeting brings together 30 countries whose strategic fuel reserves account for the vast majority of the petroleum product buffer of the developed industrialised nations. In Tallinn, they will discuss ways of rebalancing the global oil market and the impact of the green transition on the fossil fuel business, and exchange experiences on managing fuel reserves and the deployment thereof in crisis situations.

According to Priit Enok, member of the board of the Estonian Stockpiling Agency and chairman of ACOMES, the meeting of stockholding entities around the world, the Tallinn meeting is significant in terms of the large number of participants, the level of representation, as well as the timing.

‘Everyone will be there. Countries with very large fuel reserves, such as the US and Japan, will be equal partners at the meeting table with small European countries, including us. In a crisis, it is necessary to ensure the availability of fuel for society, and then, it is not so much the size of the reserves that counts, but the ability to mobilise them quickly in cooperation with our partners. Russia’s aggression in Ukraine and the increasingly frequent climate disasters have vividly demonstrated the importance of reserves,’ said Enok.

Developed industrialised countries, led by the United States, began to build up 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, the leading industrialised countries set up the International Energy Agency (IEA) in 1974, and countries dependent on fuel imports began to stockpile fuels. The national and commercial stocks held by IEA member states today could cover the entire global consumption of petroleum products for 450 days.

Priit Enok asserts that strategic national fuel stocks have a real impact on managing oil crises and, to some extent, on stabilising fuel prices. ‘Estonia’s membership of the IEA and its active participation in the cooperation of stockholding entities in the fuel sector can be compared without exaggeration to our membership of NATO – with the specificity that here, we are dealing with energy security and we are ready to collectively defend ourselves against market shocks,’ Enok explained.

The state-owned AS Eesti Varude Keskus (Estonian Stockpiling Agency) holds motor fuel, diesel, and aviation fuel as strategic stocks in Estonia in the amount corresponding to 90 days of normal consumption. The fuel reserve is intended to ensure the security of supply, security, and subsistence of the population of the country, as well as to meet the commitments undertaken under international treaties.

The ESPA collects about €5 million a year in stockpiling fees from fuel retailers to cover the costs of managing liquid fuel stocks. A car owner with an average mileage pays a stockpiling fee of around €7 a year when filling up their tank. The fuel stockpiling fee covers all costs related to the management of stocks.