In a move aimed at alleviating global energy supply concerns, G7 countries have agreed to release 100 million barrels of diesel and crude oil. The decision was made during a video conference of G7 leaders, chaired by French President Emmanuel Macron. The release will be coordinated through the International Energy Agency (IEA) and is set to begin immediately over four months.
The agreement comes as energy prices have surged globally, driven in part by the conflict between Israel and Iran. The situation has led to soaring fuel prices, which have become a pressing issue ahead of midterm congressional elections in the United States. US President Donald Trump had previously considered imposing a ban on US exports of diesel, a move that would have significantly impacted the European Union.
The G7 leaders' decision includes a frontloaded substantial diesel release within the first 20 days. They also agreed that there would be no ban on diesel exports between them. The leaders reaffirmed their commitment to refrain from export restrictions on energy and energy products between G7 countries and called on all producers to refrain from imposing bans that could exacerbate market tensions.
US pressure played a significant role in the G7's decision. US Treasury Secretary Scott Bessent had urged European nations to release strategic reserves, warning that American farmers, truckers, and businesses should not bear the brunt of a global diesel shortage. US Energy Secretary Chris Wright also held talks with his British counterpart Miatta Fahnbulleh on the crisis.
The impact of high fuel prices is being felt globally. British dairy farmer Keith Blackshaw complained of a "vicious circle" with high fuel prices being passed onto customers. The 32 members of the IEA had previously agreed to unlock 400 million barrels of oil from reserves, their largest release ever. However, about a third of these stocks have yet to come to market.
The G7 leaders also emphasized their commitment to maintaining sanctions against Russia while working with the IEA and global partners to prevent further spillovers into fuel, gas, and other commodity markets. Diesel prices in the United States and Europe have hit record highs in recent weeks, partly due to an export ban imposed by Russia in response to Ukrainian attacks on fuel facilities.
The agreement has been welcomed by President Trump, who stated that European countries had agreed to release a "massive amount" of diesel from their reserves. The coordinated release of oil and diesel is expected to help alleviate global energy supply concerns and stabilize fuel prices.
Key points
- The G7 countries have agreed to release 100 million barrels of diesel and crude oil to ease global energy supply concerns.
- The release will be coordinated through the International Energy Agency (IEA) and is set to begin immediately over four months.
- The agreement also includes a commitment from the G7 leaders to refrain from export restrictions on energy and energy products between them.
