By Gina Lee

Investing.com – Oil was down on Friday morning in Asia and was set for a weekly loss of 3% after consuming countries agreed to of oil from emergency stocks.

By 12:30 PM ET (9:30 GMT) the prices had dropped 0.64% to $99.94 and then fell to 0.47% to $95.58

International Energy Agency executive director Faith Birol tweeted that the organization “is moving ahead with a collective oil stock release of 120 million barrels (including 60 million barrels contributed by the U.S. as part of its overall draw from its Strategic Petroleum Reserve).” More details of specific contributions will be released soon, the tweet added.

Between May and the end 2022, about 1 million barrels will be released daily. Some investors believe that it would limit the price increase in the short-term, but wouldn’t fully compensate volumes lost to Russia by sanctions following its invasion of Ukraine on February 24th.

Although this release is the largest since 1980 when the stockpile was established, it won’t change fundamentals of the oil market. “It is likely to delay additional increases in output by key producers,” ANZ Research analysts stated in a note.

This release may also discourage producers such as the Organization of the Petroleum Exporting Countries (OPEC) and U.S. Shale producers from increasing output even at $100/barrel oil prices, the note said.

Meanwhile, the European Union (EU)’s consideration of a ban on Russian oil, following its plan to embargo Russian coal, will cap any losses for the black liquid in the short term.

Innes’ note stated that “In the courtof public opinion,” there is increasing pressure on Brussels to take action. He also said that if the EU sanctions Russian oil and the pressure valve opens, Brent crude could be at $120 within a matter of minutes.”