Dáil Éireann - Volume 600 - 12 April, 2005
Written Answers. - Energy Resources.
Mr. F. McGrath Mr. F. McGrath
414. Mr. F. McGrath asked the Minister for Communications, Marine and Natural Resources if a serious oil supply crisis is imminent; and the plans in place to deal with a potential crisis. [10611/05]
Mr. N. Dempsey Mr. N. Dempsey
Mr. N. Dempsey:Ireland is a member of the International Energy Agency, IEA, an OECD body which, inter alia, monitors developments in the international oil market. The IEA keeps the oil market situation under constant review. While international oil prices are currently high, the IEA considers that the supply-demand fundamentals should not lead to a supply crisis.
As a member of the IEA, Ireland is required to maintain emergency oil stocks equivalent to at least 90 days of net imports of crude oil equivalent in the previous year. The EU imposes a similar requirement based on consumption. At the end of December 2004, the combined stocks of IEA member countries, including Ireland, were equivalent to 114 days of net imports. Ireland’s stocks were estimated at 115 days’ net imports on 1 February 2005.
My Department has contingency arrangements in place to deal with major oil supply disruptions. In the event of a significant global oil supply crisis, Ireland’s oil reserves would be eked out over an extended period to supplement commercial supplies which would continue to be avail able, albeit at a reduced level, in the normal course. In this context, reserves provide cover for periods far in excess of their expression in terms of number of days.
There would be no question of Ireland or any other oil-consuming country attempting to deal on its own with an international oil crisis. If such a crisis were to occur, the response, including the release of emergency stocks and the identification of alternative sources of supply, would take place primarily within the framework of the formal emergency regime developed and maintained by the IEA. Under this regime, member states would be entitled to a share of available IEA oil stocks in the event of a reduction of at least 7% in normal global supply levels. There are also provisions for a co-ordinated international response to an emerging crisis, without the oil-sharing component, in advance of the 7% trigger.
I am satisfied Ireland’s emergency stock levels are more than sufficient to ensure that we would be in a position to participate effectively in an internationally co-ordinated response in the event of an oil supply crisis. In addition, it is clear that if all countries and all users turned their attentions in a focussed way to increased energy conservation, this would impact on market sentiment which is a key driver of the crude oil price.
Dáil Éireann 600 Written Answers. Energy Resources.