One day after the European Commission’s Gas Coordination Group gave a satisfactory state of play with respect to gas storage and supply, the executive issued a similarly rosy assessment of emergency oil stocks. This followed a meeting of the Commission’s Oil Supply Group that met in Brussels to confirm that current levels of emergency oil stocks in Europe are at 122 days of consumption. The Commission notes that this figure is well above the mandatory 90 days.

The Oil Supply Group, which brings together member states’ oil experts, aims to coordinate member states’ responses to possible disruptions of oil supplies. Another element to the 15 December meeting was implementation of the new oil stocks legislation. Officially adopted by the EU in September 2009, Council Directive 2009/119/EC regroups and updates previous legislation in the field, notably Council Directives 2006/67/EC and 73/238/EEC and Council Decision 68/416/EEC. The new directive should be transposed into member states’ national laws by 31 December 2012.

Despite the weakening of its November 2008 proposal, the Commission still notes that the new directive will bring the EU system of oil stocks closer to current international practices and strengthen the Community’s capacity to react in the event of a supply crisis. The Commission notes that the legislation gives the EU new powers. Gone, however, is any suggestion that the Commission should have the ability to force member states to release stocks in an emergency. The executive should now only recommend release. The legislation also does not fundamentally change the current requirement to provide stocks for 90 days.

At the meeting, Commission officials promised to continue enforcing the reporting discipline foreseen. A number of countries have faced infringement procedures. Most recently, Ireland, in January 2009, was ordered by the Commission to amend legislation that allows its oil stocks to be used as collateral.

The new directive is available at www.europolitics.info > Search = 263324

Background

Under the new directive, member states now have until 31 December 2012 to ensure that their total oil stocks meet at least 61 days of average daily inland consumption or 90 days of average daily net imports (whichever of the two is greater). Member states also have to hold at least 30 days of stocks or a third of their stockholding obligation in the form of refined products (tailored to their actual consumption patterns). Member states that are not members of the International Energy Agency (IEA) are given a further two years to ensure that their stocks meet required levels.