Oil falls almost 3%, pulling back on its rally after the IEA says it will work on easing oil prices in a hurry

• IEA chief Fatih Birol told an energy conference in Paris the agency will release more oil from stocks to ease surging fuel prices.
• His plan is a response to President Biden's ban on imports of Russian oil and gas to the US.

Oil prices slipped by over 2% Wednesday after the International Energy Agency said it will draw up an action plan to ease oil prices, saying it can release additional stocks if needed.

Brent crude futures were down 2.6% at $124.69 a barrel as of 7:10 a.m ET, after the agency's head said it could boost supply in response to the US's ban on Russian oil and gas imports. West Texas Intermediate fell 2.7% to $120.37 a barrel, also losing grip on earlier gains.

"Next week, as we did for gas, we are coming up with a 10-point action plan to reduce oil in a hurry," the IEA's executive director Fatih Birol told an energy conference in Paris on Wednesday, Reuters reported.

"If there is a need, we can bring more oil to the markets," he said.

IEA members agreed last week to release 60 million barrels of oil stockpiles in an attempt to halt price rises. Half of the release will come from the US Strategic Petroleum Reserve, with the rest coming from Europe and Asia.

Birol said that those proposed measures were "an initial response", accounting for just 4% of the IEA's total reserves. "If our governments decide so, we can bring more oil to the markets," he added.

The IEA is moving to ease oil prices after President Joe Biden announced a US ban on Russian oil imports on Tuesday. He warned that all Americans were likely to feel the impact of "Putin's price hike" at the gas pumps.

Oil prices are up 65% so far this year, as Western sanctions against Russia spark fears of a supply shortfall.

Russia is the world's third-largest oil producer and accounts for 11 million barrels per day, or 10%, of total global supply, according to the IEA.

Bank of America has warned that sanctions could drive the price of oil to $200 a barrel, noting that an import ban could lead to a shortfall of at least 5 million barrels per day.

Other analysts have noted that prices will continue to rise if other Western nations follow the US's lead in sanctioning Russian energy. The UK has already announced plans to phase out all Russian oil products by the end of 2022.

"It feels like European public opinion is building towards completely cutting off the Russian energy supply," Deutsche Bank managing director Jim Reid said in a research note.

Russia, meanwhile, has warned oil prices could hit $300 a barrel if the US and Europe reject Russian oil.

"It is absolutely clear that a rejection of Russian oil would lead to catastrophic consequences for the global market," Russian deputy prime minister Alexander Novak — who also oversees energy affairs — said on state television on Monday, according to a Reuters translation.