The International Energy Agency (IEA) is an alliance of 26 nations created in the 1970s to ensure energy security for its members. The United States, Japan, Korea, and most European countries are members of the IEA, which works in conjunction with the ORGANIZATION FOR ECONOMIC COOPERATION AND DEVELOPMENT (OECD). The IEA’s objectives are
• to maintain and improve systems for coping with oilsupply disruptions
• to promote rational energy policies in a global context through cooperative relations with nonmember countries, industries, and international organizations
• to operate a permanent information system on the international oil market
• to improve the world’s energy supply and demand structure by developing alternative energy sources and increasing the efficiency of energy use
• to assist in the integration of environmental and energy policies.
The IEA publishes the monthly Oil Market Report and the biannual World Energy Outlook and reports regularly on the energy policies of its member states and those of selected nonmembers. Most of the IEA members are major oil-importing countries. As such, they oppose restrictions made on oil production, particularly the actions by the ORGANIZATION OF PETROLEUM EXPORTING COUNTRIES (OPEC) to reduce supplies and raise market prices. However, the IEA has no power to direct policies by member countries. Norway, an IEA member, changed from a net-importing country to the world’s third-largest oil-exporting country. In 1998 and 2002, Norway reduced oil output along with OPEC countries in an effort to increase the world price of oil. The IEA reviewed Norway’s actions but took no action. Most industrial nations were caught by surprise during the energy crises in the 1970s. Working together through the IEA, member countries attempt to offset the market power of oil-exporting countries. One of the agreements among IEA members is to maintain a stockpile of oil to be released during emergencies. The United States maintains a stock of petroleum reserves in caverns in the western part of the country.