G7 to Release Up to 100 Million Barrels of Oil and Diesel Amid Rising Prices

G7 nations and their partners agreed to release up to 100 million barrels of their emergency oil and diesel reserves, in an operation coordinated by the International Energy Agency (IEA) that will take place over the next four months. The announcement was made by Emmanuel Macron, President of France and current holder of the G7 presidency, at a press conference, where he explained that the bloc's goal is to drive down fuel prices.

The decision came after the United States raised the possibility of imposing a ban on diesel exports if European countries did not release more supplies, a measure that, according to Bloomberg, threatened a key supply source for the continent, which relies heavily on imports to cover its diesel production shortfall. Macron noted that all members committed to releasing strategic reserves with a focus on diesel and to avoiding export bans, a point on which, he said, President Donald Trump had been very clear. Trump, for his part, welcomed the move in a social media post, stating that Europe had agreed to release a large amount of its stored diesel and that the process would begin immediately.

The IEA had already coordinated a plan in March to release 400 million barrels shortly after the outbreak of the war with Iran, but Trump had criticized Europe for not making those barrels available quickly enough. A subsequent G7 statement suggested that the 100 million barrels announced could include volumes not yet released under that March plan. Following the announcement, European diesel prices and Brent crude futures fell, with the diesel premium over crude oil dropping to $69 per barrel, down from $76.77 the previous Thursday, according to Bloomberg data.

According to an analysis by BRS Tanker reported by MundoMaritimo, a potential ban on U.S. diesel exports would primarily affect the MR2 tanker segment, which carries more than 90% of U.S. shipments of that fuel. The consultancy estimated that the measure could remove up to 1.35 million barrels per day from the international market, equivalent to four MR2-sized cargoes per day, and put the probability of the ban being enacted before the November 6 midterm elections at over 50%. Europe and Latin America were among the regions most exposed to that potential supply reduction.

Days later, ahead of its Governing Board meeting scheduled for October 15, IEA Executive Director Fatih Birol sent a letter to member countries stating that tension in the global diesel market required immediate attention and could be addressed through continued cooperation among partners. Birol proposed that members who had not yet completed the volumes committed to under the March Collective Action consider accelerating pending releases, prioritizing diesel, and that even those who had already met their commitments assess whether additional releases were necessary. In his message, he also referred to the recent attacks on civilian and energy infrastructure in Saudi Arabia, including those at Riyadh's international airport.